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Accounting records the dual effect of double-entity bookkeeping. Each transaction affects at least two accounts - one on accounts debit and other on credit side. This assures, that the accounting equation (Assets = Liabilities) balances after each transaction. Transactions are first recorded in the journal and after that posted to the accounts in the general ledger. Accounts are classified as permanent accounts and temporary accounts. The temporary accounts are revenue and expense accounts and they relate to particular accounting period and are closed at the end of the period. …
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