Mistaken idea “Debit always means decrease and credit always means increase”

Correction

Debit means the left side of an account, and credit means the right side. Whether either side increases or decreases an account depends on the account type, not on the word alone.

Use the account's normal balance

The normal balance is the side on which an account normally increases. A debit increases a normal-debit account and decreases a normal-credit account. A credit does the reverse.

Why the wrong answer seems reasonable

Consumer bank statements use debit and credit from the bank's point of view. A debit card also feels connected with money leaving an account. Those uses can make debit sound like a universal minus sign and credit sound like a plus sign. Financial accounting assigns the direction only after the account is classified.

Where it goes wrong

Harbor Design is a design-services corporation. When it receives a $6,000 customer advance for future work, Cash increases with a $6,000 debit and Unearned Revenue increases with a $6,000 credit. Both accounts increase, but they use opposite sides because Cash is an asset and Unearned Revenue is a liability.

Harbor Design then pays $1,000 of an existing supplier debt. That payment shows the other pattern:

Both accounts decrease. The liability decreases with a debit, and the asset decreases with a credit.

Check your answer

If you chose a side before naming the account class, stop and classify the account. Also check any rule that says every increase is a credit or every decrease is a debit. Both statements fail for assets and expenses.

What to do instead

1. Name the account and its class.
2. Identify the account's normal balance.
3. Decide whether the account increased or decreased.
4. Use the normal-balance pattern to choose debit or credit.
5. Confirm that total debits equal total credits after every line is classified.