Comment by omichowdhury

I think the fundamental problem is the traditional accounting equation:

  Assets + Expenses = Liabilities + Equity + Income

We try to group the accounts by left and right side and find a common term for them (credit-normal and debit-normal). But it’s really hard to come up with an intuitive answer for why Assets and Expense should be on one team, and why the rest should be on the other team. So we just pick some team names and say shut-up-and-calculate.

What if we re-arranged the equation to:

  Assets - Liabilities = Income - Expenses

The accounts on the left side track your net worth. The accounts on the right side track why net worth changes. What should be the names for the two sides? I call them State and Change.

You can then ditch credits and debits and ask - what is the impact of this financial transaction on my net worth? The equation will tell you which accounts should go up and go down using positive and negative numbers.

I go more into how this works here: https://news.ycombinator.com/item?id=39994335