Re: double-entry bookkeeping unneeded?

topmind wrote:
Thomas Gagne wrote:
topmind wrote:
Thomas Gagne wrote:

I've written multiple financial OLTP systems and can confidently say
there's no such thing as "john bill 5".

A transaction system must be able to record:

Check for $10.
Cash for $20.
Deposit to checking $15.
Payment to line-of-credit: $15.

These are 4 *separate* transactions, aren't they? It is still:

A, B, 10.00
C, D, 20.00
E, F, 15.00
G, H, 15.00

Think of it as:
A: $10
B: $20
C: $15
D: $15

What are the letters here? In my example, they were account codes, such
as "cash", "accounts payable", etc.
The same--they're accounts.
<snip>
Isn't it: A = L + E rather than "= 0"? Summing to zero is not enough.
It is enough. In fact, its how accounting is done. 0 = debits + credits. If everything your accounting transaction does adds to 0, you're in good shape. Money going into one account must come from another account. Adding 100 to a credit account and adding 100 to a debit account = 0. Adding 100 to a debit account and subtracting 100 from a debit account also = 0. That's good, too.


--
Visit <http://blogs.instreamfinancial.com/anything.php> to read my rants on technology and the finance industry.
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