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0 pointsalexambarch2y ago0 comments

From what I got out of the article and my own limited understanding of double entry bookkeeping, the "double" seems to be referring to the part where we split a transaction into credits and debits as opposed to a transaction with positive or negative balance. The doubling is happening with the labels we use to describe what's happening with the money.

From an individual account perspective, there's a doubling of the number of columns you could enter a transaction's amount into.

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2 comments · 2 top-level

gorjusborg2y ago

The core innovation of 'double entry' is that you can see the flow of money between accounts for every transaction.

This is possible because you (the accountant) are always adding a back-reference from the other account (hence the 'double' in 'double entry').

There's really not much to it. It throws people that are new to it for a loop, I think, because it is a strange way of behaving, and it isn't obvious why you're doing it until you have to track down something that doesn't balance. It's just a disciplined behavior that accountants started using because it allows one to track things that were difficult without it.

vpribish2y ago

this is probably not true, but I heard that this stuff predates the idea of negative numbers so you have db and cr accounts that offset each other without negatives.

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