3. Single-entry accounting vs. double-entry accounting

There is an old joke in the accounting industry: There is an old accountant who would open his own drawer to take a look every day when doing accounting. At a glance, sometimes it was the drawer on the left, sometimes the drawer on the right. His colleagues were curious about whether there was any "treasure" in the drawer. Until one day when the old accountant retired, a colleague opened the drawer and saw that there was only one note in the left and right drawers. The note in the left drawer said "borrow", and the note in the right drawer said "loan".

This story is said to be used to complain about the incomprehensible nature of double-entry bookkeeping. But if we put aside the two inexplicable words "borrow" and "loan" first, simply look at why it needs to be dealt with in this way, and then understand further, it may be simpler.

So let’s first take a look at how double-entry accounting came about.

Some people usually have the habit of keeping accounts. For example, if they ate a bowl of snail noodles at noon today, then record the expenditure of 15 yuan; if they went to the store to buy a piece of clothing in the evening, then they would record the expenditure. Record the expenditure of 300 yuan. In the beginning, the company's accounting was also kept this way - only one line was recorded for each business. This was called "single-entry accounting."

However, such accounting does not fully reflect one thing: Was this bowl of snail noodles bought with cash or with Huabei? Did you buy that piece of clothing using Yu'E Bao, using a credit card, or using WeChat? In fact, you can't tell just by looking at this stroke.

Moreover, using cash and Yu’e Bao actually consumes the assets in one’s hands - “money”, but using credit cards or Huabei is different. Credit cards or Huabei will not immediately reduce the amount of money in hand. There is no "money" on the Internet, but the bank or Alipay company quietly writes down a sum of "so-and-so owes me xx yuan" for us, and then sends us bills to ask for money in the future. In other words, when we buy this bowl of rice noodles or clothes, we do not reduce our "assets", but increase our "liabilities". This cannot be seen from the single-entry accounting method.

Therefore, if you want to see the ins and outs of the above thing, you actually need to remember two lines of things: what you got (or why), and how you got it (how you did it). As the saying goes, you must pay for what you gain, equal exchange.

For example, if the clothes were bought with cash, then these two lines are:

What was obtained (for what): the asset (clothes) increased by 300

Is this much clearer?

Okay, now let’s take a look at the balance sheet. Buying clothes:

At this time we can see that the assets on the left have increased or decreased by 300 yuan internally, while the liabilities and owner's equity on the right have not changed, so the overall balance is still maintained. Assets = Liabilities + Owners’ Equity.

Similarly, the same goes for buying snail noodles. However, snail noodles are something that is consumed immediately and cannot be regarded as assets. It is more appropriate to regard them as expenses. Assuming it was bought with Huabei, then these two lines are:

What did you get (for what): The cost (eating snail noodles) increased by 15

How did it come about? Do it): Liabilities (money owed to Huabei) increase? 15

Because as an expense, it will lead to a decrease in profits - the final result is that the owner's equity will also decrease (if you feel confused, you might as well remember it first) Conclusion, I will talk about it separately in the future), then the reflection on the balance sheet is like this:

At this time we can see that this time, the two things on the right have changed: Liabilities It has increased by 15 yuan, while the owner's equity has decreased by 15 yuan, but in general, the sum of the right side has not changed, and the assets on the left have not changed themselves. Assets = liabilities + owner's equity, which still holds true.

The above two examples are examples where the left and right sums have not changed. So what if the left and right sums change?

Take Xiaohei Dian’s acceptance of a loan from Xiaobai’s father as an example:

What did you get (for what): Increase in assets (money)? 100,000

How did it come about (how to do it): The liability (borrowing money from dad) increased? 100,000

At this time, the balance sheet is:

It can be seen that this example is A situation where a rising tide lifts all boats, increasing both left and right at the same time. But even so, because the exact same amount has been added to both sides of the equation, the identity of assets = liabilities + owners' equity will still hold.

However, if we just record it in words, sometimes we are adding at the same time, and sometimes we are adding and subtracting, it is always inconsistent. It is difficult to judge whether it is really balanced all the time, and it cannot be like this every time. Draw pictures. At this time, the twin evil spirits of "loan and loan" appear.

At this time, don’t get hung up on the meaning of these two words, but simply regard it as a symbol similar to √×, and then remember one rule first: the content on the left (assets) , increases to "debit" and decreases to "credit"; the content on the right (liabilities, owners' equity), increases to "credit" and decreases to "debit".

So what will happen to the first three things?

Let’s “translate” the “account” we made earlier:

In this way, every time you record an account, whether it is increasing or decreasing at the same time, or adding it unilaterally. If there is a deduction, there will always be at least one debit and one loan (you can try to think about it yourself), and the amounts must be the same. Whether something is increasing or decreasing can actually be judged by combining the symbol of "borrow/credit" + the nature of the noun behind it. This is "whatever you borrow must be a loan, and what you borrow must be equal."

At this time, Bai Xiaobai finally understood how to do accounting. Although she still knew nothing about the various "accounting subjects", at least in the major categories, she could understand what would be borrowed. , What's the loan?

In this article, especially in the early stage, in order not to increase the burden on everyone as much as possible, broad categories will be used instead of specific accounting subjects when writing entries. At the same time, in order to connect with future study, specific accounting subjects will be marked after the general categories, so friends who have room for learning can get familiar with them in advance.

Then after completing the industrial and commercial registration (official "birth") in Xiaoheidian, opening your own bank account, and transferring all the money, you should do the accounting like this:

Debit: assets (bank deposits)? 300,000

? Credit: owner's equity (paid-in capital)? 300,000

The little black shop borrowed money from his father. As mentioned before, this is how it is accounted for:

Borrow: Asset (bank deposit)? 100,000

? Loan: Liability (long-term loan) 100,000

After completing these two accounts at the beginning of the period, the balance sheet of the small black store at the beginning of the store will be formed as shown in the example above: < /p>

Please note at this time that in the company’s daily operations, most of the collection and payment are made through bank accounts, and cash is rarely used. Therefore, as long as it involves using money to collect money, , the corresponding accounting items are mostly "bank deposits". On the one hand, this is because it is too troublesome to receive and pay large amounts of funds in cash. Imagine that the former contractor used stacks of hemp bags to pay wages to migrant workers... It was so refreshing; on the other hand, cash The whereabouts of money cannot be monitored, so the country has already mandated settlement through bank accounts. Let’s continue to imagine the situation of paying wages to migrant workers. Unless the scene is videotaped, who can be sure afterwards that the money was really paid to the person based on his signature alone? Therefore, using bank transfer for payment is a kind of protection for both parties, and they want to know the true whereabouts of the funds (the boss wants to confirm whether the money is really spent, and the tax bureau wants to know whether there is really such expenditure) , which can also be easily confirmed.