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Bookkeeping is to maintain day to day financial transaction. It is a vital process for every business. Through bookkeeping firm find out their final profit or loss. Bookkeeping is to maintain a journal and then post their transitions in the final book that is called ledger. If you want to become a good businessman so you have to study accounting and bookkeeping in your studies. We can also explain accounting as a process of bookkeeping. In bookkeeping firms follows two type of entry system first is-
Single entry system: it is easy then double entry system. The single entry system is the simplest form of bookkeeping, as the name indicates single entry system is to record every transaction in a single entry. It is one-sided accounting entry. In this, only two columns are made one is for income and one is for expenses.
Double entry system: in this, every transaction will be recorded in two accounts. Like an example; if the corporation borrows some money from the bank so, the (assets) cash account will boost, and the responsibility account will also increase. So both assets and liability will be equal. If your assets and liability account are not equal so it means there is some error in your transaction recording. The double entry system is a broad term.
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