Learn the basic ideas behind accounting, including debits, credits, the T-account and why companies choose their financial year. Simple explanations for beginners.
A fiscal year is the 12-month period an organization uses for its accounts, and it does not have to match the calendar year. Many companies end their year when business is quiet, so their books are easier to close. Retailers, for example, often end their year in late January, after the holiday rush. Governments follow … Read more
In Short: Debits are on the left because of a habit started by Italian merchants more than 500 years ago. In their ledgers, each account took up two facing pages: the left page recorded what a person or account “should give” (debit), and the right page recorded what it “should have” (credit). The modern T-account … Read more