Lessons · Accounting · debit is left, credit is right
Debit means left. Credit means right. That is all.
A debit is an entry on the left-hand side of an account and a credit is an entry on the right-hand side. Neither is good or bad, more or less.
Hone is a place to practise a career, one idea a day. This is one of its lessons, written out in full and free to read without an account.
What it is for
The bank writes to say it has credited your account, and that sounds like good news, because in the bank's books your deposit is money the bank owes you. New bookkeepers freeze on this for weeks. Left and right, nothing more, and the freezing stops.
How to think about it
Draw the account as a T. Put every debit on the left and every credit on the right. Subtract the smaller side from the larger and the balance sits on the larger side.
Worked example
Cash: left side is debit, right side is creditThe T. Every account has the same shape.
Dr Cash 500 → written on the leftDr is short for debit.
Cr Cash 200 → written on the rightCr is short for credit.
Balance = 500 − 200 = 300 on the left, a debit balanceThe larger side wins and the balance sits there.
Your turn
Write the abbreviation that means the right-hand side, in a line that puts 350 on that side of cash.
Cash 350
Solve one, graded on the server
The trap
Reading debit as minus. A debit to cash makes cash bigger. The sign lives in the account type, not in the word.