Question

What does the term "Double-entry accounting" mean?

1) That the Income and Expense accounts are always part of every transaction.
2) There are always at least two accounts involved in every financial transaction.
3) That the Cost of Goods Sold account and the Liabilities account are always part of a transaction.
4) The Equity and Asset accounts are always involved in a transaction.

Answer 1

Double-entry accounting refers to the system where every financial transaction affects at least two accounts, ensuring the accounting equation stays balanced. option d is answer

Step-by-step explanation:

The term "Double-entry accounting" means there are always at least two accounts involved in every financial transaction. This is a fundamental principle where one account is debited and another is credited for every transaction, ensuring that the accounting equation of Assets = Liabilities

Equity always remains balanced. Double-entry accounting allows for the system of checks and balances, which can prevent errors in the financial statements, as changes in one side of the equation are always matched with changes on the other side. option d is answer