When Are Expenses Credited
When Expenses increase, we debit these and when these decrease, we credit these according to the Rules of Debit And Credit . Expenses have normal or positive or favorable debit balance which is closed to Income Summary Account at the end of the accounting period as these are Temporary Accounts . Credit balance in expense account shows u nfavorable or negative balance which is due to certain we discussed here. In these certain circumstances we credited expenses accounts instead of debited. B elow is the list of those reasons due to which expenses are credited: 1. Post Closing Entries At the end of the accounting period, all the expenses are closed to income summary account. we pass the following negative journal entry for all negative expenses accounts which are now closing: Income Summary Account a/c XXX ...