Debit and credits on reports

Mark's Avatar

Mark

09 Nov, 2014 11:44 PM

Hi,
On reports money going out is classed as a credit and money in is showin as a debit. Is this not back to front? Surly credits are money in and debits money out?

Please advise

Thanks

  1. Support Staff 1 Posted by Mathew on 10 Nov, 2014 12:04 PM

    Mathew's Avatar

    Hi Mark,

    No. This is a common mistake people make though.

    Debits are money coming in to your account. Credits are money leaving your account.

    The reason people get confused about this is they hear the bank say things like "you are £20 in credit". But this is from the bank's point of view (not yours). In other words, they owe you that £20 and it represents a credit balance to them. In your own accounts you would record that as a debit.

    I hope that makes sense,

    Mathew

  2. 2 Posted by Mark Putnam on 10 Nov, 2014 10:29 PM

    Mark Putnam's Avatar

    Thanks Matthew, appreciated.

    Great software!

    Mark Putnam

  3. Mathew closed this discussion on 11 Nov, 2014 09:22 AM.

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