In journal entries, a debit signifies a decrease in which type of account?

• A. Assets
• B. Expenses
• C. Revenues
• D. Liabilities

Answer: (D)

Verified step by step guidance

1. Understand the basic accounting equation: \(\text{Assets} = \text{Liabilities} + \text{Equity}\). This equation helps determine how debits and credits affect different accounts.
2. Recall that in double-entry accounting, debits and credits have opposite effects on different types of accounts. For example, debits increase assets and expenses but decrease liabilities, equity, and revenues.
3. Identify the effect of a debit on liabilities: since liabilities represent obligations or debts, a debit entry reduces the balance of a liability account.
4. Compare the options given: assets, expenses, revenues, and liabilities. Debits increase assets and expenses, and decrease liabilities and revenues.
5. Conclude that a debit signifies a decrease in liabilities, which aligns with the correct answer provided.