What accounts are increased with credits
Updated: Oct 14
In accounting, accounts that are increased with credits typically include revenue accounts, liability accounts, and equity accounts. When a credit entry is made, it indicates an increase in these accounts. This is essential for maintaining accurate financial records and ensuring that the accounting equation stays balanced. Understanding which accounts are affected by credits is crucial for accurate bookkeeping and financial reporting.
Accounts That Go Up With a Credit
Revenue accounts, such as sales and service income.
Liability accounts, such as loans, credit cards, and accounts payable.
Equity accounts, such as owner investment and retained earnings.
Quick Examples
You send a customer an invoice for $1,500. Credit Revenue $1,500. Debit Accounts Receivable $1,500.
You borrow $10,000 from the bank. Credit Loan Payable $10,000. Debit Cash $10,000.
You put $5,000 of your own money into the business. Credit Owner Equity $5,000. Debit Cash $5,000.
Check Your Work
In every entry, total debits must equal total credits. If they do not match, something was entered wrong. Look for a typed number that is off or a missing side of the entry.
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