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2006-11-28 10:54:45 · 4 answers · asked by Isacc E 2 in Business & Finance Personal Finance

4 answers

it depends on what side of the coin you are.

in your own accounting records, a debit balance most likely means that someone owes you money. the person who owes you money will have a credit balance in their own accounting records.

conversely, in your own accounting records, a credit balance most likely meanst that you owe someone money. the person who you owe money to will have a debit balance in their accounting records.

2006-11-28 11:03:18 · answer #1 · answered by loveholio 5 · 0 0

Now that you are totally confused by two answers from two professional people maybe I can clear this up for you. It is a matter of point of view. Every debit is balanced by a credit. That applies to the books of a business as well a a person.

So If you borrow from a bank you have a debit for cash in hand that you borrowed (or the tv you traded it for). You also have a credit liability for the amount you owe.

The bank has a debit for the account receivable you owe them and a credit for the source of their funds.

If you have a debit balance in your checking account you have an asset. If you have a debit balance with a loan shark you have liability with them. Hope this helps.

2006-11-28 20:38:10 · answer #2 · answered by gatzap 5 · 0 0

If a company says that you have a debit balance, then that means you owe them money. And to the last guy, I DON'T have it backwards. If the company says you have a debit balance, then that means THEY HAVE A RECEIVABLE, and you have a PAYABLE. I said the same thing as guy #2, you are just too stupid to understand that. Oh, by the way, Debit does not equal postitive, credit does not equal negative. Debit means left, Credit means right. That's all.

2006-11-28 18:56:45 · answer #3 · answered by kjhenkel 2 · 0 0

The first guy has it backwards. Second guy right on.

A debit is a positive number, a credit is negative. If they extend you credit, you have a credit balance and owe them money. If you have a debit balance, you've overpaid and they owe you. With banking it seems backwards, because they look at your deposits as credits, ie, they owe you the money.

2006-11-28 19:03:24 · answer #4 · answered by loon_mallet_wielder 5 · 0 0

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