People who have sinned can use merits to atone for their sins.
If the merits are great and the sins are small, then atonement can be completed, and the remaining merits can still be used to measure whether one can enter the divine society (heaven) or reincarnate into human society. .
If the merits are small and the sins are great, atonement cannot be completed. If there is no complete atonement, one will still go to hell, but the number of levels of hell can be reduced.