Is interest expense a debit or a credit?

Understand the Problem

The question is asking whether interest expense should be recorded as a debit or a credit in accounting. Typically, an interest expense is a cost incurred by a business and is recorded as a debit because it increases expenses on the income statement.

More Information

Interest expense is recorded as a debit in accounting because expenses are always debited to increase their balance.

Tips

A common mistake is confusing an expense account with a liability account, which operates differently in terms of debit and credit.

Sources

• Interest Expense Accounting - freshbooks.com
• Interest Expense: Definition, Example, and Calculation - Deskera - deskera.com
• Interest Expenses: How They Are Recorded On Income Statement - LiveFlow - liveflow.io