Double-entry bookkeeping

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Double-entry bookkeeping, also known as double-entry accounting, is a method of bookkeeping in which every financial transaction is recorded with equal and opposite entries (debits and credits) - thus "balancing the books". The purpose of double-entry bookkeeping is to maintain accuracy in financial records and allow detection of errors or fraud. The basis of double-entry bookkeeping is the accounting equation: A s s e t s = L i a b i l i t i e s + E q u i t y {\displaystyle \mathrm {Assets} =\mathrm {Liabilities} +\mathrm {Equity} } Every transaction recorded will keep this equation in balance. For example, a company can buy a new piece of equipment (increasing...

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