Definition of Book Keeping
Bookkeeping is the process of recording, analyzing, and interpreting the financial transaction of a business in agriculture. The transaction includes purchases, sales, receipts, and payments by an individual person or an organization/cooperation.
There are two types of book keeping, which includes:
- Single – entry book keeping
- Double – entry book keeping
(a) Single Entry Book Keeping: This uses only income and expense accounts, recorded primarily in a revenue and expense journal. It is adequate for small businesses. The major record kept in the single-entry bookkeeping is the cash book.
(b) Double Entry Book Keeping: This requires posting or recording each transaction twice, using debits and credits. Therefore, every debit entry has a corresponding credit entry, and this serves as a kind of error detection system.