Definition of Debit
A debit is an entry on the left side of a T-account.
A debit entry is used to record assets, expenses, losses, and owner’s draws in their appropriate general ledger accounts. A debit reduces the amounts in liability and owner’s (stockholders’) equity accounts.
Definition of Debit Balance
A debit balance is the normal balance in the general ledger accounts for assets, expenses, losses, and owner’s draws.
Example of Debit and Debit Balance
Let’s assume that a person starts a business as a sole proprietorship with an investment of $5,000. The entry to business accounts will include a debit to Cash for $5,000. On the next day, the business spends $1,000 to purchase office equipment. Part of this entry will include a credit to Cash for $1,000. After this transaction is recorded, the Cash account will have a debit balance of $4,000.
