Rules for Recording Business Transactions Under the Double-Entry System:

Rules for Recording Business Transactions Under the Double-Entry System:

     As stated earlier, each transaction affects two accounts. One account receives the benefit of the transaction, and the other account gives the benefit of the transaction. So, for recording each transaction completely under the double-entry system of book-keeping, the account which receives the benefit of the transaction must be debited, and the account which gives the benefit of the transaction must be credited. This is the golden, fundamental or general rule of the double-entry system of book-keeping.

     No doubt, the golden, fundamental or general rule of the double-entry system for debit and credit is that the account that receives the benefit of the transaction should be debited and the account that gives the benefit of the transaction should be credited. However, as there are three classes of accounts, the general rule for debit and credit is adjusted in accordance with the types of accounts, and three sets of rules are laid down for the three classes of accounts.