Credits example sentences

Commercial banks create this extra amount of money by giving out a part of their deposits as loans or investment credits.It implies that if the sum of all debits equals the sum of all credits, it is presumed that the posting to the ledger in terms of debit and credit amounts is accurate.After the debits and credits for each transaction are entered in the journal, they are transferred to the individual accounts.As for the interest invalued, if it is not paid in cash, the drawer debits the drawee's account and credits the interest account, and the drawee debits the interest and credits the drawer's account in his books.This error would give the two accounts incorrect balances but would not create unequal debits and credits.It is rather a mechanism of maintaining records whereby some transactions are recorded with proper debits and credits while in case of others, either one sided or no entry is made.On the left side, all cash transactions relating to cash receipts (debits) and on the right side all transactions relating to cash payments (credits) are entered date-wise.It only ensures that all debits and the corresponding credits have been properly recorded in the ledger.This practice provides a complete record of each transaction in one place and links the debits and credits for each transaction.According to American Institute of Public Accountants, balance sheet is “a tabular statement of summary of balances (debits and credits) carried forward after an actual and constructive closing of books of accounts and kept according to principles of accounting”.When two or more errors are committed in such a way that the net effect of these errors on the debits and credits of accounts is nil, such errors are called compensating errors.A transaction with one debit and one credit is a simple transaction and the accounting vouchers prepared for such transaction is known as Transaction oucher, the format of which is shown in figureure oucher which records a transaction that entails multiple debits/credits and one credit/debit is called compound voucher.They may be entities like the government, corporation, banks which also take different economic decisions like how much to spend, what interest rate to charge on the credits, how much to tax, etc.In the preceding pages, you learnt about debits and credits and observed how transactions affect accounts.RBI is the independent authority for conducting monetary policy in the best interests of the economy – it increases or decreases the supply of high powered money in the economy and creates incentives or disincentives for the commercial banks to give loans or credits to investors.