Q. 1. I heard that through the Sacrament of Confession, the merits of good works are restored. What does that mean?
A. 1. Every time you do a good deed, be it speaking a kind word to someone, or perform a charitable act, help an orphan, visit the sick, including your prayers, your attendance at Masses, offering up Masses, receiving the Sacraments, etc... you earn merits (credits) that will increase your glory in Heaven. To qualify for these merits, you must perform good works while in a state of grace and with the intention of doing it out of love for God.
When you are in a state of mortal sin, you lose all your accumulated merits. That means you lost everything and must start at zero again. Through the Sacrament of Confession, the merits (credits) of your good works that were lost through mortal sin, they are restored to you.
In Divine Justice, God could have allowed your merits to be lost forever, even after forgiving your sins. But in his infinite goodness, he does not make you start all over from zero. The Sacrament of Confession not only forgives your mortal sins, it also restores the merits of good works that you had lost willingly by consenting to sin.