Expenses Debit Or Credit

Here, we will study about Expenses Debit or Credit In Accounting.

You may also be interested in “Incomes Debit or Credit”

When Expense increases, we debit it and when expense decreases, we credit it according to Rules of Debit And Credit. For Expenses, normally, the Debit Balance is found by the business as expenses are incurring by the business on daily basis to operate the business and ultimately to earn revenues during the Current Accounting Period. But since the expense account is needed to be closed at the end of Current Accounting Period as these are the results of Profitable Activities of the Owners of the Business so, it is closed at the end of Current Accounting Period by transferring it to Income Statement or Profit & Loss Account or Statement of Comprehensive Income. So Expenses have no balances and it is adjusted with the Owner’s Equity or Equity in The Balance Sheet or Statement of Financial Position.

Expense Account is closed by passing Closing Journal Entry. Following Closing Accounting Journal is Passed in case of all expenses of the business:

               Income Statement / Profit And Loss  a/c    XXX

                                                                            Expenses  a/c   XXX

(Expenses Are Closed By Transferring to Income Statement At The End of Accounting Period)

So, it is all about Expenses Debit or Credit In Accounting.