What do we call any debit a business owes?

The term used to describe any debit that a business owes is "liabilities." Liabilities represent financial obligations or debts that a company must settle in the future due to past transactions or events. They are a crucial part of the balance sheet and are categorized into current liabilities, which are due within one year, and long-term liabilities, which are due over a longer period.

Understanding liabilities is fundamental in accounting and finance because they provide insight into a business's financial health, indicating how much of the company's resources are financed through borrowing. Analyzing liabilities helps stakeholders assess the risks of the business and its ability to meet its obligations.

On the other hand, assets are resources owned by a business, credits typically refer to the opposite of debits in accounting and pertain to income or revenue, while equities represent the value of an owner's interest in the business after liabilities are subtracted from assets. Each of these terms plays a significant role in financial reporting, but in this context, liabilities specifically denote what the business owes.