Here are five tips to make learning debits and credits easier:
2. The accounts for revenues are almost always credited. When a bakery sells its products, it credits Sales. When a bank earns interest on its loans, it credits Loan Interest Revenues.
3. When a company issues a check, it credits the asset account Cash.
4. When a company receives money, it debits Cash.
5. Every transaction will require a debit to at least one account and a credit to at least one other account.
Here are two examples to illustrate our five tips. A bakery records its cash sales at a local market with a debit to Cash and a credit to Sales. A company records its $400 payment to repair its delivery van with a debit to Vehicle Repair Expense and a credit to Cash.