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TERM OF THE DAY credit 1. Accounting: An entry on the right-hand side of an account record in double entry bookkeeping. It has the effect of decreasing an asset or expense account, or of increasing a capital, liability, or revenue account. See also debit. 2. Banking: Purchasing power created by banks through lending based onfractional reserve system. 3. Commerce: An agreement based largely on trust under which goods,services, or money is exchanged against a promise to pay later. Also calledcommercial credit. 4. Short form of the term letter of credit. Learn more about this term Usage Example The customer overpaid for the company's service one month, so he was given acredit to apply to the next month's bill.

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FEATURED ARTICLE How to Finance Your Higher Education Many high school students approaching graduation are concerned about how to finance education costs for college or for other types of training that can easily... Read this article

VOICE YOUR OPINION What's the hardest question to ask when you're being interviewed?