According to J.R Batliboi, "Every financial transaction involves a transfer of money or its equivalent from one person to another. It must necessarily, therefore, require two parties for its performance, and may mean either the receipt of a benefit in the shape of cash, goods or services or the imparting of such benefits."

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Features of Double-Entry Bookkeeping

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Source: Freepik / Flaticon

Two parties involved

Transaction happens only if there are two parties: one party giving the benefit and the other party receiving the benefit.

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Both parties are affected by a transaction

Each party is affected by the transaction in opposite directions, but with equal amounts.

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Debit and credit both for every account

Each account has two sides-one is debit and the other one is credit.

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Debit equals credit

For every transaction, the debit amount is equal to the credit amount.

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Debt on the left side and credit on the right side

The account that receives the benefit or payment is recorded on the left-hand side; this is called debit. On the other hand, the account that renders the benefit is recorded on the right-hand side; this is called credit.