credit (redirected from Development of the Law of Credit)

Credit

Money loaned.

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Credit

1. An agreement between a buyer and a seller in which the buyer receives the good or service in advance and makes payment later, often over time and usually with interest. For example, a buyer may purchase a computer on credit for $600 and pay $100 per month over several months with interest. One of the most common ways of buying on credit is to use a credit card, but many companies have their own credit schemes. A steady flow of credit in an economy is considered important for financial health. See also: Accounts receivable, Accounts payable.

2. The amount in a bank account or some other account. For example, if one has $800 in his/her bank, he/she is said to have an $800 credit. Likewise, if he/she receives a check for another $200, he/she receives a further $200 credit.

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credit

1. The ability to borrow or to purchase goods and services with payment delayed beyond delivery.

2. An accounting entry resulting in an increase in liabilities or owners' equity or in a decrease in assets. Compare debit.

3. The balance in an account.

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Credit. Credit generally refers to the ability of a person or organization to borrow money, as well as the arrangements that are made for repaying the loan and the terms of the repayment schedule.

If you are well qualified to obtain a loan, you are said to be credit-worthy.

Credit is also used to mean positive cash entries in an account. For example, your bank account may be credited with interest. In this sense, a credit is the opposite of a debit, which means money is taken from your account.

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credit

(1) In finance,the availability of money.(2) In accounting, a liability or equity entered on the right side of the page in double-entry accounting. The concept is confusing to most consumers because an accounting “credit” does not mean more “stuff” such as property or money; it merely indicates the side of the page on which the entry is posted.The other entry is called a debit.