1.) <span>The U.S. sells $1 million worth of steel to German Builders - It is a credit item in the U.S. balance of payments because it is an inflow of payment (the U.S. receives cash from German Builders)
2.) </span><span>U.S. citizens spend $3 million on BMW's built in Germany - It is a debit item in the U.S. balance of payments because it leads to an outflow (the U.S. pays cash to Germany)
3.) </span><span>German tourists spend $3 million in the U.S. - It is a credit item in the U.S. balance of payments (the U.S. receives $3 million from German tourists)
4.) </span><span>U.S. tourists spend $8 million in Berlin, Germany - It is a debit item in the U.S. balance of payments (the U.S. spends money so it is an outflow of cash)
5.) </span><span>A German firm pays $1 million to a U.S. shipping line to transport cars to Germany - it is a credit item in the U.S. balance of payments (the U.S. receives cash of $1 million from a German firm)
Note: Credit items give rise to an inflow of payments (receiving cash) while debit items give rise to an outflow of payments (buying things or spending cash)
