The Accounting Equation – Conceptual Analogy

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This is an analogy to describe the accounting equation.

Comments

Ryan Ing says:

Excellent video. My professor at Ryerson university has recommended your
video as part of our course outline.

Learn Free Accounting says:

4:52 there was a mistake, when you pay the lender you should have debited
the Liability not the Owners equity and credited assets as you did
Thanks 

art1716 says:

WHERE DID YOU COME FROM?? THIS IS FINALLY MAKING SENSE!! WHY CAN’T ANY OF
THESE PROFESSOR IDIOTS TEACH THIS SIMPLY.. THANK YOU. THANK YOU! THANK YOU!
NOW MAYBE WITH THE LORD’S HELP I CAN FINALLY PASS THIS COURSE!

Ryan Watson says:

Really great video. We’d love to reference this in one of our accounting
instructional courses, with your permission of course. Can’t access your
website to reach out personally – please let me know if you’d be open to
it. We’ll of course give all credit to AccountingWITT.

contabilidadetv says:

this analogy is awesome, I have a channel of accounting here in Brazil, I
really liked your explanation

nostalgiae says:

Hi Justin, the term returning suggests “giving back,” to give something
back you would have to receive it first that is why it is being returned
from “the amount borrowing” On the other hand, when “paying” for something
you are expected to give from your own money in exchange for a
product/service. In this case you’re paying for the other island’s service
of “allowing you to borrow money” — hope this helps!

Don McCormick says:

Who are you??

AccountingWITT says:

I am someone who likes LearnWITT. When I learn something, I figure out how
to share what I learned.

Candice Gayle says:

There is one thing that I don’t understand…if you plant two coconuts on
your island, isn’t it supposed to increase the amount of coconuts in the
total and capital, instead of decreasing the total? How come the two
coconuts are gone at this point in the problem

ludicrousgib says:

Great analogy. Thanks and keep the videos coming!

sameerology says:

Outstanding!!

studer3500 says:

Very clear, thank you.

Shubham Shrivastava says:

amazing i m not frm commerce back ground but always wanted to learn
accounts……thnx a lot videos was very helpful looking forward to learn a
lot from you

erimas44 says:

No, because the analogy of planting coconuts is the same as investing
money, u invest two coconuts from the capital, after a period each coconut
come up with 5 other coconuts, basically your “loose” 2 ones and then the
capital decrease, but after a period these two grow and give u 10 other
coconuts that’s when the capital increase .. 🙂

thelewa7 says:

THANK YOUUUUUUUUUUUUUUUUUUUUUUUUUU

mountedantman10 says:

Because the 2 coconuts turned into a tree and it will take a while before
it seeds again, if ever at all.

K. mac says:

Excellent =)

Ashley Kiani says:

thank you so much!!!! the equation makes so much more sense!!

Don McCormick says:

Thank you very much!

Cradmasor says:

It’s awesome !

Jamar Evans says:

Wow I plan on taking a course and majoring and upon watching your video all
I have to say is you are a superb teacher.

Maung Thura says:

This Analogy is genius. Now I know the whole picture within 8 minutes.
Worth it!!!

Justin Kim says:

what is the difference between paying the lender and returning the lender?

Nhi Hà says:

My prof in Ryerson University suggested me this vid 😉 really helpful !!!
Thank you so much.

Thanh Bình Nguyễn says:

so great!. thank you so much!!

AccountingWITT says:

@ludicrousgib You’re welcome. I have a lot of new stuff coming out soon.

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