Accounting Debit and Credit is an essential part of understanding the overall financial health of a business. Debit entries are made to represent money paid out or expenses incurred while credit entries are made to represent money taken in or income earned. In accounting, debit and credits are used as tools to track and monitor the flow of money in and out of a business. Tracking this flow can provide valuable insight into the solvency of a business; making it easier for accountants to review the financials, make decisions about investments, and plan for the future.