What is the story behind 'debit' & 'credit'?

Answer 1

http://credit.about.com/od/buyersguide/bb/debitrisk.htm

Answer 2

Debits and Credits in Accounting allow you to balance the books.

When you debit an account, you take value out.
When you credit an account you add value to the account.

Using accounting practices, if you buy a building you debit cash and credit Building Assets. There will be no change in your value, since the building is worth the amount of money that you paid for it.

In a bank, debits are cash withdrawals. A debit card is normally used to withdraw money.

A credit card is much worse since when the credit card account gets credited you owe more money. The more credit you have, the deeper in debt you can get yourself.

Take care,
Troy

Answer 3

If its a distinction between Debit cards and Credit Cards then Debit card is the one where it comes straight from your account and you will be able to spend only the amount that you have in your bank whereas in a credit you will have a set limit as to how much you can spend and then you will be required to pay that money in a monthly instalment with interest...
Whereas just "debits" and "credits" are simply the money being deducted from your account and money added to your account.

Answer 4

If someone say you are Debtor to him, it mean that you owe money to that person (he is creditor to you)

If on the other hand if someone say you are Creditor to him, which means that he owes money to you(he is your debtor)


The relationship between Credit and Debit could be understood in simple term....If you can keep in mind the Golden Principles of Accounting.....

Real account - Debit what comes in and
Credit what goes out
Personal account - Debit the Receiver and
Credit the Giver
Nominal account - Debit all expenses and losses
Credit all incomes and gains


Regards
Sunil

Answer 5

debit is something you owe, and credit is something owed to you . In the case of going to the store and using an Atm card and being asked ''debit or credit'' that refeers to debit coming out of your account right now or as soon as the transaction hits the bank, and credit is something you will be billed for on a monthly statement from the credit card company ......

Answer 6

Credit acts like a credit card it takes longer to hit your bank, Debit the funds are taken out as soon as you punch in your pin or same day atleast.

Answer 7

Debit is from your checking account
Credit is an account a creditor has given you with a limit which you are allowed to pay small monthly payments in agreement to paying a lil extra which they call interest

Answer 8

It comes from accounting nomenclature. Debit was on the left side of the ledger, and "in your favor" or added to assets. Credit was on right side of ledger and subtracted from your assets or added to liabilities. When a merchant "credited" your account, they subtracted it from their side, as a credit, adding it to your asset or decreasing your balance to them. When a bank "debits" your account, they subtract from your balance, while it seems in the same way, actually as an opposite manner because banks consider an account (savings, checking, etc.) as a "debt" owed to you. Therefore when they "debit" your account, they are actually "adding" to their assets but subtracting from yours. The generic understanding of the consumers as to what is happening is correct but there is an accounting transaction that matches each debit or credit based upon how it affects the ledger (or balance sheet)

Answer 9

debit and credit is actually like sex
credit is what goes in and debit is what comes out

Answer 10

In debit, we give money to someone & the person who has to give money to some1 is called debtor.
In credit, money comes in from some source & the person who has to receive money from some debtor is called creditor.

Answer 11

Debt comes straight out of your bank account. Credit is paid monthly