What is double entry bookkeeping?

Double-entry bookkeeping is a robust accounting method employed to meticulously document financial transactions. In this system, each business transaction triggers a dual entry, with an entry made in at least two distinct accounts as either a debit or a credit. The fundamental principle is that the total debits must always precisely match the total credits, ensuring accuracy and balance in the financial records. This meticulous approach not only aids in tracking financial activity but also helps in the preparation of financial statements, making it an indispensable tool for businesses and organizations to maintain financial transparency and accountability.

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