Account Debited is an accounting term used to describe when a transaction is recorded in a ledger and decreases the balance of a particular account. It’s a concept that is essential to understanding business finances, as it allows businesses to track where their money is going each month. In short, if something is debited then it’s being taken out of the account. This could be expenses such as payroll, taxes, supplies, overhead costs – anything that results in money leaving the company.
Account Debited is not just reserved for cash though; other forms of debiting can occur too. Assets, liabilities, equity and revenue can all be debited from an account. So by keeping accurate records of your debits and credits, you can ensure your business remains organised, compliant and efficient.