Debtors -1. Debtors are those persons who owes amount to the business on account of credit sales of goods and services.
2. Debtors are an asset for the company because amount is to be received from them.
3. Increase in Debtors we will be debited.
Creditors -1. Creditors are those persons to whom business owes amount on account of credit purchases of goods and services.
2. Creditors are liabilities for the business because money is to be paid to them by the business.
3. Increase in creditors will be credited.