Accounting debit and credit are two of the foundational components of double-entry bookkeeping. Debit entries represent an amount that is owed, while credit entries record an amount received. Debits increase assets or expenses, while credits decrease liabilities, equity, and income. All financial transactions involve a debit to one account, and a credit to another account – thus their balanced relationship. To make wise financial decisions, it’s important for business owners to understand these concepts, which will maintain the accuracy and credibility of their accounts.