I learn double-entry accounting and it makes sense for a while, but inevitably it slips away and once more I must relearn it. Debits, credits... assets, liabilities, equity... how can something so simple be so complicated?
Double-Entry Accounting
- Thread starter LearningToLetGo
- Start date
What really gets me is the debit vs credit, e.g. debits on the left side (assets) increase an item whereas debits on the right side (liabilities & equity) decrease. This is hard enough to get straight with computers. It boggles my mind how folks a thousand or more years ago managed this using only paper.
Debits and Credits is a way of dealing with negative and competing values on the books. As such it is a useful, if not wholly good thing. But a debit eventually is moved to accounts payable (the bill becomes due). Economically, the problem comes when we cease to understand the relation between the debit and credit and take on more debt (promises of future payment) than we can cheerfully bear. We often deceive ourselves that taking on the debt is a step of faith, without considering about when the bill becomes due.
We get so used to deficit spending (credit) that we apply the concept in an out of context manner. We see sin as a deficit and suppose that our virtues will cancel those out (or will in the future).
Not so.
Although I am generally healthy, I know that at 70 years old, I am closer to being the honored at a funeral than I am to many other things. I note that what many who pass leave economically to their progeny is debt.
Similarly, whatever virtues I embody are insufficient to cover my deficit due to my sin.
I must never suppose it otherwise.
While good works can keep my focus on He who I serve, it can never reduce my debt. That debt was paid by Christ.
Debt is accounted for and Sin always matters.
We get so used to deficit spending (credit) that we apply the concept in an out of context manner. We see sin as a deficit and suppose that our virtues will cancel those out (or will in the future).
Not so.
Although I am generally healthy, I know that at 70 years old, I am closer to being the honored at a funeral than I am to many other things. I note that what many who pass leave economically to their progeny is debt.
Similarly, whatever virtues I embody are insufficient to cover my deficit due to my sin.
I must never suppose it otherwise.
While good works can keep my focus on He who I serve, it can never reduce my debt. That debt was paid by Christ.
Debt is accounted for and Sin always matters.
I agree that taking on debt larger than we can cheerfully bear is a problem but that's not exactly what I was talking about. I was simply referring to debits as the entry in the left column and credits as the entry in the right. On an asset ledger, the debit increases the asset whereas a credit decreases it. This is opposite the behavior on a liability or equity ledger where credits increase and debits decrease.
The whole thing boggles the mind.
nicely put.