Which entry is typically made when an entity incurs a liability?

When an entity incurs a liability, it typically results in a credit entry to a liability account to reflect the increase in obligations. Therefore, the correct entry involves crediting the liability account, which is not represented in the provided choices.

The debit to an expense account generally reflects the recognition of an expense incurred or services received, which may relate to the liability being recognized but does not address the actual incurrence of the liability itself. In accounting, when a company incurs a liability, for example, by taking out a loan, it acknowledges that it owes money and thus credits the liability account while usually debiting an associated asset or expense based on the context of the transaction.

In the context of the other choices, crediting an asset account would inaccurately reflect a decrease in assets, which doesn't align with incurring a liability. Debiting an asset would generally indicate an increase in assets contrary to the nature of incurring liabilities. Crediting a revenue account relates to generating income, which is not directly related to the incurrence of liabilities.

Understanding the relationship between liabilities, assets, and expenses is crucial. When a liability is incurred, it signifies an obligation that will be settled in the future, often associated with receiving value in the form of goods or services