Which of the following types of accounts are decreased by debits?

The concept of debits and credits is fundamental in accounting, particularly in understanding how different accounts react to these entries. In accounting, debits decrease accounts classified as revenue, liabilities, and owners' equity.

When it comes to revenue accounts, a debit entry typically indicates a decrease because revenues are expected to increase with credits. Therefore, when you debit a revenue account, it reflects a reduction in income.

In terms of liabilities, debits also decrease these accounts. Liabilities represent obligations to pay, and a debit reflects a reduction in these obligations. For instance, when a payment is made, the liability account would be debited, indicating a decrease in what the entity owes.

Owners' equity, which represents the owners' residual interest in the assets of a business after deducting liabilities, also decreases when debited. This is because any distribution to owners (like dividends) or a loss incurred during a period would be recorded as a debit, thus reducing the overall equity.

Given this consistent application across revenue, liabilities, and owners' equity, it is correct to state that all the listed types of accounts are decreased by debits. This understanding is crucial for effective financial analysis and reporting, as the impacts of debits and credits must be correctly managed to