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Credits and debits

BubblygirlBubblygirl Just JoinedRegistered Posts: 1
Please can someone confirm in simple terms the difference from credits and debits?

Comments

  • roy ramphulroy ramphul Feels At Home Registered Posts: 36
    A Credit is an increase in revenue & Liability and a decrease in asset and expense.

    A Debit is an increase in expense and asset and a decrease in in reveune and liability.
  • Lei ZhouLei Zhou New Member Registered Posts: 13
    A Credit is an increase in revenue, liability & EQUITY, and a decrease in asset and expense.

    A Debit is an increase in expense and asset and a decrease in in reveune, liability & EQUITY.
  • Rose_20Rose_20 Settling In Nicely Registered Posts: 15
    Credits & Debits

    Hi!

    Is'nt it just like this, the money coming into the business is a Debit entry (Increase in Assets) e.g Stock. The money going out is a Credit entry. (Increase in Liabilities, (Borrowings) e.g rent. etc.

    Hope im right.

    :001_unsure:
  • DevilishbirdDevilishbird Feels At Home Registered Posts: 56
    The best way I was ever taught how to remember these was:

    AED =
    Asset, Expense, Drawings (D stands for Debit)

    LIC =
    Liabilities, Income, Capital (C stands for Credit)

    Remember first AED which sits on the left side of the TB and LIC sits on the right side. Then you will not get your Debits and Credits mixed up,

    Hope that helps you
    :001_smile:
  • Mathew_HillMathew_Hill Settling In Nicely Registered Posts: 23
    We always got taught to use PEARLS. Please see below:

    Debits
    Purchases
    Expenses
    Assets

    Credits
    Revenues
    Liabilities
    Sales.

    That always really helped me.

    Matt
  • A-VicA-Vic Expertise Guaranteed Registered Posts: 6,970
    Pearls

    (D)Purchase Expence Assits (credit)Revenue Liability Sales


    now enter that in a t account or trial balance works every time

    Vic :001_smile:

    PEA/RLS
  • CharliCharli Just Joined Registered Posts: 1
    lessons on line

    Hi

    have a look at the e-learning lessons on here. they are really good for explaining debts and credits. They helped me loads.

    :001_smile:
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