what is the meaning of debit and credit?

Answer 1

Debit and Credit are formal bookkeeping and accounting terms that have opposite meanings and come from Latin. Debit comes from debere, which means "to owe". The Latin debitum means "debt". Credit comes from the Latin word credere, which means "to believe".

Debit is abbreviated Dr., while credit is abbreviated Cr.

"Debit" also refers to the left side of a general ledger account, while "Credit" refers to the right side.

A debit is also (informally) referred to as a "charge."

A debit or credit changes the balance of an account. Asset and expense accounts increase in value when debited and decrease when credited, whereas liability, equity, and revenue accounts decrease in value when debited and increase when credited. This distinction is somewhat counterintuitive, until the nature of those accounts is more closely scrutinized. For example, revenue is coded as a credit. After recording a day's sales, the company will have credited a certain amount in revenue, and since credits are negative numbers, the balance grows more and more negative. An adjustment to revenue would need to be a debit, because its purpose is to bring the revenue totals closer to zero.

It is often assumed that a debit decreases a balance, and a credit increases it, because this is how the terms are used on bank statements and using a debit card decreases the balance in one's bank account. However, this is because bank statements are traditionally written from the bank's perspective, where the customer's account is a liability. By withdrawing money, the customer is decreasing the bank's liability. Since liability accounts normally have a credit balance, the withdrawal of cash from a banking account is reflected on the bank's balance sheet as a debit.

Answer 2

Debit Definition

Answer 3

Personal A/c - Rules - Debit the Receiver and Credit the Giver
Real A/c - Rules - Debit what comes in and Credit what goes out
Nominal A/c - Rules - Debit Expenses, Loses and Credit Incomes, Gains.

Answer 4

"Debit" and "credit" are accounting terms for different columns. The debit column shows money going out of an account, the credit column shows money going into the account.

That being said, that isn't what most people are talking about when they use the term. A "debit card" is different from a "credit card" in that when used, the former takes money directly from your bank account. There may or may not be an intermediary financial institution like Visa or Mastercard, but the end result is the same: the money you spend with a debit card is deducted from your checking account automatically.

A credit card works differently. There, you have a line of credit, meaning you can borrow up to a certain amount at will. The money you spend with a credit card doesn't automatically come from your checking account, but comes from a the financial institution issuing the card. So if you have, say, a Chase credit card, and when you use the card, the money that goes to the merchant comes from Chase. You are then required to pay them back, as they're only lending you the money. As the interest rates for this kind of consumer lending tend to be quite high, there is an incentive to pay off the balance right away.

Answer 5

For the best answers, search on this site https://shorturl.im/aDInh

The credit card when used, has to be paid off in monthly installments, or pay in full when the statement comes in. The debit card when used will deduct money straight from your checking account. It's just like writing a check or paying cash for something.In fact, it is your cash you are using. Sometimes the machines will not accept the debit card, but will allow it to be run through as a credit card, but it will still be deducted from your checking account. Hope I explained it well enough for you.

Answer 6

This Site Might Help You.

RE:
what is the meaning of debit and credit?

Answer 7

Debit what comes in ; credit what goes out
Debit all expenses and losses ; credit all incomes and gains.
Debit the receiver ; Credit the giver

Answer 8

Debit means: an entry recording a sum owed, listed on the left-hand side or column of an account.
Credit means: an entry recording a sum received, listed on the right-hand side or column of an account.

Answer 9

debit & credit refers on 3 rules,which are following.
1)debit what comes in,credit what goes out.
2)debit the receiver,credit the giver.
3)debit r all expenses,credit r all gains

Answer 10

debit which means to owe and credit means to believe or confidence