Essential Book Keeping - Qp3

It is much easier to have a lot of accounts with relatively few transactions in each.

If we limit the transactions in an account to a particular customer, the balance on the account also represents the balance on that customer’s account.

In order to make sure that the accounts do not contain any erroneous transactions, it is important to balance the accounts on a yearly basis.

The capital of a business represents the money that the investors and banks have put in.

The basic accounting equation is: Capital = Assets + Liabilities