In accounting, what term represents an entry that records an increase in assets or a decrease in liabilities?

The term that represents an entry recording an increase in assets or a decrease in liabilities is a debit. In accounting principles, debits are used to track various types of transactions. When an asset account is debited, it signifies that the asset's value is increasing, which could happen with transactions such as cash sales or purchasing equipment.

Debits also relate to liability accounts, where a decrease in liabilities is also recorded as a debit. For example, if a company pays off part of its debt, it would debit the liability account to reflect that decrease. This fundamental accounting concept helps maintain the balance in the accounting equation, ensuring that total assets equal total liabilities plus equity.

Understanding debits is essential for anyone involved in accounting or financial analysis, as they form the basis for accurately recording various financial transactions.