Differentiate between credit and debit?

Credit and debit are two different types of financial transactions that involve the movement of funds in and out of a bank account.

Credit:
1. A credit transaction involves the addition of funds to a bank account.
2. It increases the balance in the account.
3. Examples of credit transactions include deposits, transfers from another account, and cashback rewards.
4. Credit transactions are typically used to receive money or make payments.

Debit:
1. A debit transaction involves the deduction of funds from a bank account.
2. It decreases the balance in the account.
3. Examples of debit transactions include withdrawals, purchases, and bill payments.
4. Debit transactions are typically used to spend money or transfer funds to another account.

In summary, credit transactions add funds to an account, while debit transactions deduct funds from an account.

Credit

- A financial transaction that increases a liability or equity account.
- Represents an inflow of resources or a decrease in obligations.
- Usually recorded on the right side of an accounting entry.
- Examples:
- Recording sales made on account
- Issuing capital stock
- Receiving a loan

Debit

- A financial transaction that decreases a liability or equity account or increases an asset account.
- Represents an outflow of resources or an increase in obligations.
- Usually recorded on the left side of an accounting entry.
- Examples:
- Purchasing inventory on account
- Paying off a loan
- Recording expenses incurred