Today, I want to discuss something very important which is the accounting equation Which you will always need, which is the starting step that qualifies you Until you are a certified chartered accountant if you want to I’m still searching for a way to simplify this equation. So that my writing is an integral part of my memory and I don’t forget it So let’s start by explaining the method that simplifies the DC / ADE / LER accounting equation Then you must remember these letters well, it does not matter the way in which you will remember them.
The important thing is to remain in your memory Because you will write it again only, you have to memorize it well And because it is so important, we will put it here at the top of the board. I already wrote it at the top of the board, but the word DC is not clear. We will write it here We will ignore this aspect of the debtor This is for the creditor Debit Creditor Now that you know that the debtor side must always equal with the creditor side It is simple information and now we turn to the creditor side Debit .
So in the world of accounting, the creditor and the debtor side must always be equal (that is, the sum of both sides of the account must be equal) And now on the creditor side we will put the letters ADE (meaning abbreviations for the word assets, withdrawals and expenses, whose nature is debited). On the creditor side, the LER letter (meaning abbreviations for the word liabilities, property rights and income, whose original nature is creditor) First letter of LIABILITY + EQUITY + REVENUE Letter A, assets of letter D, withdrawn letter E, expenses. The letter D is drawn, meaning Draw The letter E, for which we write expenses And now to the creditor side Obligations Then property rights Then the revenue You started to break the talisman and this is what I wanted from you. This is all you need It is very important to you on the first day of your career that you just have to remember these words. Let’s start now Well ..DC / ADE / LER is my way I hold a Bachelor of Commerce from Florida And the certified accountant’s certificate from the University of Atlanta and I still use this method To keep the information present in my memories .
Remember this method and write it down. We still have a lot and a lot to offer .We have a series of lessons on the income statement. The statement of financial position.