A Balance Sheet Debit Credit is a part of the accounting process which tracks the total liabilities and assets at any given time. It works by showing how much an entity – such as a business or individual – owes or owns. Every transaction that occurs has to be recorded in one of two ways: either as a debit or a credit. This means that when someone buys something on credit, the value of their purchase will be marked as a debit on the balance sheet, while the lender’s value for the purchase will be marked as a credit. Through this system, the Balance Sheet Debit Credit can track the flow of money and ensure accurate bookkeeping.