I have made a small balance sheet on google docs for my monthly expenses and income. If something comes into my account, would that be a credit or a debit in my account? If I got 500 from somewhere, would that 500 be written under debit column or credit column? Why?

6 Answers 6


The bank will make this even more confusing because they use the terms from their own perspective.

From the bank's perspective (printed on your statements)
credit: Money into your account (increases the bank's liabilities)
debit: Money out of your account (decrease bank liabilities)

From your perspective:
It depends on the nature of the transfer of money, but here are the most common for a personal account.
Income into your account: Credit
Expenses out of your account: Debit
Payment on a loan made for an asset (house/car): Credit for the loan account, debit for the equity account for the car/house/etc.

Yes, it's complicated. Neither credits nor debits are always a + or -. That's why I agree with the advice of the others here that double-entry accounting is overkill for your personal finances.

Note: I simplified the above examples for the purpose of clarity. Technically every transaction in double entry accounting includes both a credit and a debit (hence the "double" in the name). In fact, sometimes a transaction involves more than one credit or debit, but always at least one of each. Also, this is for EACH party. So any transaction between you and your bank involves at least FOUR debits and/or credits when all involved are considered.


It sounds like you're mixing a simple checkbook register with double-entry bookkeeping.

Do you need a double-entry level of rigor?

Otherwise, why not have two columns, one for income (like a paycheck) and one for expenses (like paying a cable bill)? Then add up both columns and then take the difference of the sums to get your increase or decrease for the time period.

If you want to break up income and expenses further, then you can do that too.


I agree with mbhunter's suggestion of labeling your columns, 'income' and 'expenses'. However, to answer your question, money coming in (a paycheque, for example) is credited to your account. Money going out (a utility bill, for example) is debited from your account.

There's no real 'why'... this is simply the definition of the words.


If you are considering this to be an entry for your business this is how you would handle it....

You said you were making a balance sheet for monthly expenses. So on the Balance Sheet, you would be debiting cash.

For the Income Statement side you would be crediting Owner's Equity to balance the equation:

Assets = Liabilities + Owner's Equity

So if you deposited $100 to your account the equation would be affected thus:

$ 100 in Assets (Debit to Cash Account) = 0 Liabilities - $100 (Credit to Owner's Equity)

It is correctly stated above from the bank's perspective that they would be "Crediting" you account with $100, and any outflow from the bank account would be debiting your account.

  • 1
    Where the credit goes would depend on what the amount relates to. If the cash was received from a customer to clear an account receivable, then you would credit accounts receivable. If the cash was received from a customer on a cash sale, then you would credit sales. There is not enough information to accurately provide an answer on this. Commented Sep 19, 2016 at 19:32

The bank "credit's" your account for money coming into it.

In double entry accounting, you always have a debit and a credit to balance the accounts.

As an Example: for $500 that the bank credited to your checking account, you would post a debit to Cash and a Credit to Income Earned.

The accounting equation is: Assets = Liabilities + Owner's Equity $500 = $500 Cash is the "Asset" side of the equation, Income is part of Owner's Equity, and so is the Credit side... to make the equation balanced.

  • Did you really mean to post a second answer to this question, rather than editing your existing answer? Commented Dec 19, 2016 at 18:41

Most bank registers (where you write down entries) show deposits (+) to account as a CREDIT. Payments, fees, and withdrawals are DEBITs to your bank accounnt.

On loans such as credit card accounts, a credit to your loan account is a payment or other reductions of the amount you owe. A charge to your account is a DEBIT to you loan account.

They did this just to confuse us!

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