Accounting · Double Entry System
What is the key characteristic of the Double Entry System of bookkeeping?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1It records only the personal and cash aspects of a transaction.
- 2It ensures that the total debits of all transactions equal the total credits, maintaining the accounting equation.✓
- 3It prohibits the use of the Accrual Basis of accounting.
- 4It is an optional system mainly used by small businesses.
Correct answer
It ensures that the total debits of all transactions equal the total credits, maintaining the accounting equation.
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