Now that we’ve presented the fundamental accounting equation, we're ready to move on and show you how it is applied. This equation is used in what is called the system.
Each transaction and event recorded in an accounting system has a dual effect on the accounting equation. What do we mean by dual effect? Well, the equation recognizes that each transaction or event increases (+) or decreases (-)
, , and/or .
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The double-entry system
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Click here for an example.
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Click on the bold words to see them defined.
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This ends the sample of the Accounting Basics portion of the atOnce! Learning Set.