A debit is always an increase

Definition: Debits increase asset and expense accounts but decrease liability, equity, and revenue accounts. The effect depends on the account's normal balance.

Reality

Debits increase asset and expense accounts but decrease liability, equity, and revenue accounts. The effect depends on the account's normal balance.

Why It MattersUnderstanding why "a debit is always an increase" is a misconception helps avoid analytical errors and improper financial decision-making.
CategoryBookkeeping

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