The double entry bookkeeping system is a method used to record financial transactions in a way that keeps accounts balanced. In this system, every transaction affects at least two accounts, with one side being a debit and the other a credit of equal value. For example, if a business buys office equipment with cash, the equipment account is debited while the cash account is credited. This ensures that the accounting equation, which is assets equal liabilities plus equity, always stays balanced. Double entry bookkeeping helps businesses track their finances accurately, detect errors easily, and prepare reliable financial statements for better decision making.
Know more- https://www.agibookkeeping.com.au/double-entry-bookkeeping-system-explained/