When recording an expense in a financial ledger, it is entered as a _____.

• A. savings
• B. balance
• C. credit
• D. debit

Answer: (D)

Verified step by step guidance

1. Understand the basic accounting principle: Expenses are recorded as debits because they decrease equity and increase the total expenses in the financial ledger.
2. Recall the structure of a financial ledger: It consists of two sides—debits on the left and credits on the right.
3. Recognize that expenses reduce the net income, which is part of equity. In accounting, reductions in equity are recorded as debits.
4. When recording an expense, identify the account affected (e.g., Rent Expense, Utilities Expense) and enter the amount on the debit side of the ledger.
5. Ensure that the corresponding credit entry is made to the appropriate account, such as Cash or Accounts Payable, to maintain the balance in the accounting equation: Assets = Liabilities + Equity.