What is credit

Credit is an accounting term used to describe which accounting account the money is coming from when we record a transaction in the accounting system. 

We often use the terms debit and credit when it comes to which account to book on, but to make it easier to understand, you can think of it as a plus and minus. In an accounting system, a transaction should be recorded on a plus account (debit) and a minus account (credit) that shows where the values have ended up and where they have been taken from. This is called double-entry bookkeeping. 

Credit is where you have taken money from to pay for the transaction you are entering. If you have bought furniture for your office, it will be recorded as a plus (debit) because you have received a value, but the price of the furniture will be recorded as a minus (credit) on the account the money has been taken from.