Debit and Credit

All funds anticipated to be deposited into an account are recorded as debits. A credit is a list of all funds anticipated to leave an account. Debits and credits essentially keep track of where the money in your company is coming from and departing.

Many companies run their operations out of a cash account, or a corporate bank account that contains their liquid assets. When a business pays an expense out of its own pocket, the cash account is credited as funds are being removed from it to pay the expense. This indicates that the expense is being debited since the money credited from the cash account is paying for it.

The tax laws are very complex. Our short blog articles cannot cover in full all the nuances of the rules. Your specific facts may hold various opportunities and possible risks that only trained, experienced, and highly qualified tax specialists can spot. We encourage you to find such help, rather than trying to figure it all out on your own. Consider giving this marketplace a try by posting your project and signing up here.

If you are a licensed tax professional and are interested in helping others either part or full-time, or ad hoc, come on in! Happy to have you. Our marketplace has the full suite of tools to communicate with clients including compliance calendars, task and message management, and billing. You can also quickly connect to knowledgeable colleagues who can complement your services with the ones you do not provide. Register here.