Carlos S. answered 04/13/20
Effective and resourceful Guitar and Music Production Tutor
Hi! DACs function by transforming digital audio information (bits) into audible analog signal. The DAC does this by translating digital data contained in your computer into micro-electric signals that will then be amplified and sent to your monitors.
Regarding the bit depth (8, 16, 24 or 32-bit): The lower the bit rate, the more limitations appear regarding the dynamic range of your audio (in decibels). 16-bit DAC processing will require some extra signal processing before being sent to your monitors. 24-bit processing is the general output standard nowadays, while 32-bit floating process is the "in-DAW" standard.
I'm available for music production (Logic Pro X) and audio lessons if you are interested!
Have a nice week and stay safe!
Carlos