Double Entry System — Flashcards

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The main principle is that every debit has a credit and every credit has a debit. Every business transaction has a two-fold effect, so at least two accounts are affected in opposite directions.

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Double entry system is based on the principle that every transaction has two-fold aspects. It records both sides of a transaction, such as the account receiving a benefit and the account giving a bene…

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A transaction always has two aspects. If one account receives a benefit, another account gives up something of equal value. For example, when cash is received from Gopal, Cash A/c increases and Gopal'…

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Lucas Pacioli, a resident of Venice, Italy, first wrote a book on the double entry system in 1494. It described methods of recording both aspects of a transaction.

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Huge Old Castle translated the book into English in 1544.

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Edward Jones wrote English System of Books-Keeping in 1785. It revised the old system and first discussed purchase book, sales book, and preparation of a trial balance.

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"The double entry seeks to record every transaction in money or money's worth in its double aspect. The receipt of a benefit by one account and the surrender of a like benefit by another account. The …

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"Every business transaction has a two fold effect and it affects two accounts in opposite directions and if a complete record were to be made of each such transaction, it would be necessary to debit o…