Credits
Credits are one half of the basic building blocks in accounting, working together with debits. Think of credits as entries that show money going out of an account or showing what a business owes. For example, when a business takes out a loan, the bank account gets a debit (money comes in), and a credit entry shows that the business owes this money back. Bookkeepers and accountants use credits to track money flowing through a business, like when paying bills, recording sales, or managing payroll. It's similar to balancing a checkbook but on a larger, more organized scale for businesses.
Examples in Resumes
Managed accounts payable including Credits and payments for over 200 vendors monthly
Reconciled Credit entries across multiple business accounts
Processed payroll Credits and deductions for 50+ employees
Handled Credit card reconciliation and expense reporting
Typical job title: "Bookkeepers"
Also try searching for:
Where to Find Bookkeepers
Professional Organizations
Online Communities
Example Interview Questions
Senior Level Questions
Q: How do you handle complex credit situations, such as international transactions with multiple currencies?
Expected Answer: A senior bookkeeper should explain their experience managing different currency conversions, understanding exchange rates, and properly recording credits in the home currency while maintaining accurate foreign currency records.
Q: Can you describe a time when you found and corrected a significant credit-related error?
Expected Answer: They should share an example demonstrating their attention to detail, problem-solving abilities, and understanding of how credits affect the overall financial picture, including their process for correcting and documenting errors.
Mid Level Questions
Q: How do you ensure accuracy when recording credit transactions?
Expected Answer: Should discuss their system for double-checking entries, reconciliation processes, and how they maintain organized records to track credits across different accounts.
Q: Explain how credits work in relation to different types of accounts.
Expected Answer: Should be able to explain in simple terms how credits function differently for asset, liability, equity, revenue, and expense accounts, showing practical understanding.
Junior Level Questions
Q: What is the basic difference between a debit and a credit?
Expected Answer: Should be able to explain in simple terms that credits typically represent decreases in assets or increases in liabilities, while debits do the opposite.
Q: How do you record a basic credit card payment in the books?
Expected Answer: Should explain the basic process of recording the credit to cash and debit to the credit card liability account, showing understanding of simple double-entry bookkeeping.
Experience Level Indicators
Junior (0-2 years)
- Basic understanding of credits and debits
- Recording simple transactions
- Bank reconciliation
- Basic bookkeeping software use
Mid (2-5 years)
- Managing accounts payable and receivable
- Credit card reconciliation
- Financial report preparation
- Multiple account management
Senior (5+ years)
- Complex transaction management
- Financial statement analysis
- Team supervision and training
- Advanced accounting software expertise
Red Flags to Watch For
- Unable to explain basic credit and debit concepts
- No experience with accounting software
- Poor attention to detail
- Lack of understanding about account reconciliation
- No knowledge of basic accounting principles
Related Terms
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