Service Revenue: debit or credit?
Service Revenue increases on the credit side and decreases on the debit side: its normal balance is a credit.
Revenue increases equity through the business’s sales and other income. It increases with a credit.
Name in each convention
Account names and codes follow each convention; an account that does not exist in a convention is not offered there.
| Convention | Account |
|---|---|
| United States (US textbooks) | Service Revenue |
| Spain (PGC 2007) | 705 Prestaciones de servicios |
| France (PCG 2025) | 706 Prestations de services |
| Germany (generic accounts) | — |
Practice entries that use this account
- Invoicing a client for services rendered
- Service paid for on completion
- Delivering a service the customer paid in advance
- Accruing revenue earned but not yet invoiced
- Recognizing unearned revenue at year end
- Closing revenues and expenses directly to Retained Earnings
- Final invoice for a service after a deposit