Making a billion dollar company from scratch is not a child’s play, one need to make every move with precision and decisions after meticulous decisions. Maintaining and building a business is a difficult thing, people need to keep their feet grounded and make every move with proper understanding.
Maintaining record of every penny you spend is an important thing and maintaining a record of all the money that comes in as revenue is also important. Business is all about maintaining records and making decisions based on it.
Single Entry and Double Entry are two terms from commerce world; they have their distinct values and are very important for the development of a business. In this article we will be discussing about these topics in detail. We will also draw a comparison between both and present a viscous picture that will clear all your doubts.
Key Difference
The key difference among these can be defined as that Single Entry has only one entry either credit or debit, while double entry can have both credit as well as debit.
These methods of bookkeeping are very important; they present a viscous picture of the current scenario of your business and help you in making proper decisions under the limited time. Bookkeeping requires a professional with the educational background of commerce and business administration. It is important for businesses to keep a book with all the records of the transactions made and of the amount that the company has earned. The bookkeeping is a serious task and one should take this profession seriously and hire people who have enough understanding of the nuances of businesses.
Single Entry Bookkeeping
It is generally used by small companies across the world, what they do is record only one way of transaction. Either they store all the information related to outgoing transactions or the incoming transactions. These companies are small scale and they do not have bigger things to deal with and hence they make a record based on single entry.
Double Entry Bookkeeping
Bookkeeping in bigger enterprises are done with the helpful tested professionals. Professionals from the field need to have worked previously with small scaled industries and have acquired enough knowledge to make a dent in the world of bookkeeping. Double entry bookkeeping is way different from single entry and people use it for bigger enterprise. In double entry bookkeeping both side transactions are recorded. The transactions that are outgoing and that are incoming both are recorded to make the book of income updated. This style of bookkeeping is very much famous among enterprises which are listed on stock exchange. The companies are working hard to keep a record and this method seems fully legitimate for the proper understanding of the transactions of the company.
Do not let your enterprise get stuck among the policies, keep a clear income tax book and update every transaction you make. This will help you in long term and will make your business grow out of proportion.