who is debtor and who is creditor
Answers
What is a creditor?
A creditor is a term used in accounting to describe an entity (can either be a person, organisation or a government body) that is owed money, as they have provided goods or services to another entity. Sometimes, this entity will charge interest on money borrowed as a way to make money. This could be interest on bank loan repayments or credit card payments.
Examples of creditors:
1)Trade creditors – money you owe to suppliers
2)Loan from a bank or entity
What is a debtor?
A debtor is a term used in accounting to describe the opposite of a creditor — an individual that owes money, or who is in debt to an organisation or person. For example, a debtor is somebody who has taken out a loan at a bank for a new car.
Examples of debtors:
1)Trade debtors – money owed from customers
2)Staff loans
A debtor is a person or enterprise that owes money to another party. The party to whom the money is owed might be a supplier, bank, or other lender.
A creditor is a person, bank, or other enterprise that has lent money or extended credit to another party.