Debit and credit journal entries are the foundation of double-entry accounting, where each transaction is recorded with a debit to one account, and a corresponding credit to another. This ensures that all transactions are balanced and can be tracked. Put simply, a debit journal entry increases the amount of money in an account, while a credit journal entry decreases the amount of money in an account. By recording both sides of an equation, it’s easy to ensure that the amount of money coming in to a business matches the amount going out. Debit journal entries are often used to record expenses and gains/profits, and credit journal entries are used to record income and losses/missions. With this method of bookkeeping, it’s easy to identify sources of cost savings or areas where more income can be generated.