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Nice job on this. But, one has to be careful with redefining terms that have a generally accepted meaning. Changing Debit/Credit to Incoming/Outgoing smacks of

by kayo_20211030 3y ago

Nice job on this. But, one has to be careful with redefining terms that have a generally accepted meaning. Changing Debit/Credit to Incoming/Outgoing smacks of jargon and will cause confusion. Any bookkeeper will understand what credit cash and debit expense means. Putting that in incoming and outgoing terms will not help the people who do the work, or have to explain the work. It's probably worth the effort of learning the nomenclature that's been useful for a few hundred years rather than falling back on what are metaphors.

EvanAnderson 3y ago
I'll go further: Knowing basic accounting and bookkeeping jargon is a super power when it comes to dealing with finance people. Your credibility builds tremendously when you can engage with them using the proper jargon correctly.
UglyToad 3y ago
But the problem is the accounting jargon is counter (contra?) to the layman's gut understanding. If I get credited or I use a credit card money came from nowhere, woohoo. If I have a debit well that sounds like debt and my money decreased, boo. I get that actually there's a good reason for the names but a field that doggedly sticks to non intuitive jargon that runs counter to every usage yet encountered for outsiders could do with some different non-overloaded terms.
mrkeen 3y ago
> Changing Debit/Credit to Incoming/Outgoing smacks of jargon and will cause confusion. I disagree. Discussions like this on HN always invite someone to say "Look, it's super simple. Credits are just... and debits are just ...". Then a reply saying "You have it backwards. Look, it's simple! Credits are just..." I would be perfectly happy to ditch those terms forever.
- mrkeen 3y ago
  Plenty of downvotes, and yet, after writing this prediction, this thread is indeed filled with people all defining the terms 'Credit' and 'Debit' at one another. :D
  - omichowdhury 3y ago
    Yup I think it’s best to leave credits and debits behind. We can use more than 2 bits these days. I think a far more intuitive system is use negative numbers with a symmetrical accounting equation: Assets - Liabilities = Income - Expense Then you always think in terms of: - Do I have more or less assets? - Do I owe more or less liabilities? - Did I make more of less profits? - Did I make more or less losses? You can then use the accounting equation to check your reasoning. I go more into it here: https://news.ycombinator.com/item?id=40021375 https://news.ycombinator.com/item?id=40021375
MeetingsBrowser 3y ago
It seems like the target audience of this is people not already familiar with accounting. I don't understand how describing debit/credit (accounting jargon) in layman's terms smacks of jargon, but maybe that is because I am a layman =) As someone with no accounting background, credit/debt described as "money go in, money go out" seems like a good enough explanation in the context of this post. Do the "true" definitions of credit/debit differ from that in a meaningful way here?
- mrkeen 3y ago
  I just Googled it, and picked the first two results: > A debit decreases assets or increases liabilities, while a credit increases assets or decreases liabilities. [1] > A debit is always used to increase the balance of an asset account, and the cash account is an asset account. [2] [1] https://xendoo.com/blog/debits-and-credits/ https://xendoo.com/blog/debits-and-credits/ [2] https://www.fool.com/the-ascent/small-business/accounting/articles/debit-vs-credit/ https://www.fool.com/the-ascent/small-business/accounting/ar... It's not just that they're a bit confusing, it's that those words serve exactly one purpose, which is to disambiguate the exact thing that people find confusing about them. The biggest indicator of their failure is that they are always explained in terms of something clearer, and the reverse it not true. No-one says: "I don't understand what 'we received $50' means, can you explain that in terms of credits and debits?"
  - wrycoder 3y ago
    The first definition is exactly backwards - ignore it!

EvanAnderson 3y ago

I'll go further: Knowing basic accounting and bookkeeping jargon is a super power when it comes to dealing with finance people. Your credibility builds tremendously when you can engage with them using the proper jargon correctly.

UglyToad 3y ago

But the problem is the accounting jargon is counter (contra?) to the layman's gut understanding. If I get credited or I use a credit card money came from nowhere, woohoo. If I have a debit well that sounds like debt and my money decreased, boo. I get that actually there's a good reason for the names but a field that doggedly sticks to non intuitive jargon that runs counter to every usage yet encountered for outsiders could do with some different non-overloaded terms.

mrkeen 3y ago

> Changing Debit/Credit to Incoming/Outgoing smacks of jargon and will cause confusion. I disagree. Discussions like this on HN always invite someone to say "Look, it's super simple. Credits are just... and debits are just ...". Then a reply saying "You have it backwards. Look, it's simple! Credits are just..." I would be perfectly happy to ditch those terms forever.

mrkeen 3y ago
Plenty of downvotes, and yet, after writing this prediction, this thread is indeed filled with people all defining the terms 'Credit' and 'Debit' at one another. :D
- omichowdhury 3y ago
  Yup I think it’s best to leave credits and debits behind. We can use more than 2 bits these days. I think a far more intuitive system is use negative numbers with a symmetrical accounting equation: Assets - Liabilities = Income - Expense Then you always think in terms of: - Do I have more or less assets? - Do I owe more or less liabilities? - Did I make more of less profits? - Did I make more or less losses? You can then use the accounting equation to check your reasoning. I go more into it here: https://news.ycombinator.com/item?id=40021375 https://news.ycombinator.com/item?id=40021375

MeetingsBrowser 3y ago

It seems like the target audience of this is people not already familiar with accounting. I don't understand how describing debit/credit (accounting jargon) in layman's terms smacks of jargon, but maybe that is because I am a layman =) As someone with no accounting background, credit/debt described as "money go in, money go out" seems like a good enough explanation in the context of this post. Do the "true" definitions of credit/debit differ from that in a meaningful way here?

mrkeen 3y ago
I just Googled it, and picked the first two results: > A debit decreases assets or increases liabilities, while a credit increases assets or decreases liabilities. [1] > A debit is always used to increase the balance of an asset account, and the cash account is an asset account. [2] [1] https://xendoo.com/blog/debits-and-credits/ https://xendoo.com/blog/debits-and-credits/ [2] https://www.fool.com/the-ascent/small-business/accounting/articles/debit-vs-credit/ https://www.fool.com/the-ascent/small-business/accounting/ar... It's not just that they're a bit confusing, it's that those words serve exactly one purpose, which is to disambiguate the exact thing that people find confusing about them. The biggest indicator of their failure is that they are always explained in terms of something clearer, and the reverse it not true. No-one says: "I don't understand what 'we received $50' means, can you explain that in terms of credits and debits?"
- wrycoder 3y ago
  The first definition is exactly backwards - ignore it!