Question

explain the difference between debt vs debit

Answer 1

Debit is Associated with Purchase of Assets and Expense and Payments .

For day to day transactions such as Salary and wage payment, purchase of Inventory and Rawmaterial, Printing of stationary expense, Interest payment. For this transaction amount is debited in Income Statement.

Debt is amount Recorded under Liability side of balance sheet. Debt means amount of Borrowed by the company to fill financial gap for company’s day to day operations and activity. Debt may be short term or long term. E.g. of Debt is Bank Loan, Bank Overdraft facility, Debenture holder payments.