Debit expenses and Credit revenues
In accounting, we debit expenses and credit revenues because it follows the principle of double-entry bookkeeping. This principle states that every financial transaction has two equal and opposite effects: a debit entry and a credit entry.
To visit- https://www.mca.gov.in/
Expenses always come in debit because they represent a decrease in the resources (assets) of the business. By debiting expenses, we record the decrease in assets resulting from the cost of doing business such as salaries, rent, and utilities.
On the other hand, revenues come in credit side because they represent an increase in the resources (assets) of the business. By crediting revenues, we record the increase in assets resulting from the sale of goods or services.
By debiting expenses and crediting revenues, we can track the financial performance of the business over a period of time, typically a month, quarter, or year. The difference between revenues and expenses is called net income or profit, and it represents the financial success or failure of the business.
For further details access our website https://vibrantfinserv.com/