![]() ![]() Every entry in this system impacts two accounts, and debits must always equal credits. In the debit column, we enter in the increase in assets (or what you own) and the expenses, while in the credit column, we enter the liabilities (basically, what you owe) and the revenues. In a double-entry bookkeeping system, entries are recorded in the debit and credit columns. Keep going!īefore we move forward, let us shed some light on the double-entry bookkeeping system. We'll go through what this amazing element is, how to construct one, and why it's so vital in accounting in this article. Wondering, why? It allows you to examine all of your business's financial information in one location, help you prepare financial statements, and immediately discover any accounting errors. ![]() One of the most significant elements of the accounting system is the trial balance. In the end, accounting software came as a saviour and the double-entry bookkeeping system became the knight in the shining armour for the accountants. ![]() Can you imagine, how hectic it must be? And the frequency of errors? What did people do to manage their accounts and finances, before the accounting software came into existence? They actually handled all of their accounting manually. ![]()
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