DEBIT:-When we receive benefit it is debited. It is denoted by Dr.
CREDIT:-When we give or provide benefit it is credited. It is denoted by Cr.
Debits and Credits are merely the names assigned to different heads of accounts such as:
The nature of Expenses is always debited
The nature of Income is always credited
The nature of Liabilities are always credited
The nature of assets is always debited.
The nature of Capital is always credited
However it is to be noted that
Increase in expense is debit & decrease in expense is credit.
Increase in income is credit & decrease in income is debit.
Increase in liability is credit & decrease in liability is debit.
Increase in asset is debit & decrease in asset is credit.
It is our common observation that we always deduct our expenses from our income or revenue to arrive at our earning popularly known as profit.
The same logic has been followed in accounting as two different names of balances have been assigned to income and expense so that the expenses may be written opposite the income side to arrive at the profit /loss i.e., the total of which side is greater and by what amount.