Double entry bookkeeping recognizes that for every transaction that affects an asset,an equal transaction must also affect either a liability or owners' equity.

Question

Quizplus · Accepted Answer

This statement correctly describes the fundamental principle of double entry bookkeeping. Every transaction must have at least two entries, with one entry debiting an account and the other entry crediting an account. The total debits must always equal the total credits, ensuring that the accounting equation (assets = liabilities + owners' equity) remains balanced.

Double Entry Bookkeeping Recognizes That for Every Transaction That Affects