I was curious about where and how the terms debit and credit come about.
I finally come across a brief explanation of the terms.
The words have Latin origins ie. "debitum" and "creditum". Pacioli is the name of the Italian monk who wrote about accounting in the 15th century and used these terms.
So they were NOT "debere" or "credere" as I thought they were initially. And the mystery continues ie. who was the inventor of these terms.
Well I learned something new today.
3 comments:
Actually you are quite correct the first time. 'Debere' and 'credere' means 'to owe' and 'to entrust' respectively. 'Debitum' and 'Creditum' means 'debt' and 'loan'. They are all Latin.
Another interesting fact. Pacioli once lived with Leonardo da Vinci (yes, that famous renaissance artist) and taught him Maths. Hmmm perhaps that's why his drawings has such scientific angle
chiahli
Debit and Credit, Double Entry Accounting System.
Our modern day accounting design rests firmly on the work of a Franciscan monk, Luca Pacioli. He has been deemed the ‘Father of Accounting’. In 1494 he published a book Suma, sumarising the then known realm of mathematics. This work changed European history of Art, Economics and State. This was the time of European Renaissance (French; meaning rebirth) of the 14th–16th centuries. This one book became a syllabus for teaching art, mathematics, economics and stately matters. Leonardo De Vinci forged a close working relationship with Pacioli.
Debit and Credit owe their birth from 4 Latin words:
Debere: Binding to Owe.
Debitum: That which is due
Credere: Handed over via trust alone.
Creditum: A loan enacted through trust.
The key concept here is a binding debt and a loan based on trust.
I found these 4 websites tonight (the info is overload for sure), this will backup what I have mentioned above. I have an interest in art which is where I sort of heard of it before.
I find Edgar’s blog is an interesting site.
Origin of "Debit" & "Credit"
http://accountingwithedgar.blogspot.com/2007/09/origin-of-debit-credit.html
Accessed 7:22PM 11th March 2010
Why do accountants use debits and credits instead of simple pluses and minuses? Why is the notation for a debit "DR"?
http://www.investopedia.com/ask/answers/04/072304.asp
Accessed 8:24PM 11th March 2010
From Wikipedia, the free encyclopedia
http://en.wikipedia.org/wiki/Luca_Pacioli
Accessed 7:26PM 11th March 2010
Book Review
Ancient double-entry bookkeeping: Lucas Pacioli's treatise (A.D. 1494, the ...
By John Bart Geijsbeek, Luca Pacioli
http://books.google.com.au/books?id=KQxpRAAACAAJ&dq=Luca+Pacioli&source=gbs_book_other_versions
Accessed 7:25PM 11th March 2010
Hope this is helpful
Andrew Salter suntzu_artofwar@hotmail.com
i thing the old name of "debitum" was "debere" and "crdeditum" was "credere" therefore in english we ab. debit as "Dr." and Credit as "Cr."
(Bilal Dar)
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