DEBITING Meaning and
Definition
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Debiting is a financial term that refers to the action of recording or subtracting an amount of money from a particular account. It is usually associated with a double-entry bookkeeping system, where each transaction has both a debit and a credit entry. When debiting an account, it means that an amount is being removed or deducted from that particular account.
In accounting, a debit entry is made on the left side of an account, and it represents an increase in assets, expenses, or losses, or a decrease in liabilities, equity, or gains. The opposite of debiting is crediting, where an amount is added or credited to an account.
Debiting is commonly used to record various financial transactions, including purchases, withdrawals, expense payments, and loan repayments. For example, when an individual withdraws cash from their bank account, the bank will debit the account to reflect the reduction in the balance. Similarly, when a business pays a supplier for goods purchased, the accounts payable account is debited to decrease the liability.
Debiting is a crucial component of financial record-keeping, ensuring accuracy and accountability in financial reporting. It allows for a comprehensive and thorough analysis of an organization's financial activities and helps track funds flow within various accounts.
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Etymology of DEBITING
The word debiting comes from the noun debit, which originated from the Latin word debitum. Debitum means a debt or what is owed in Latin. Eventually, the noun debit evolved into a verb, giving rise to the word debiting.
Similar spelling words for DEBITING
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