What is the definition of the dual aspect concept?

The dual aspect concept, also known as the duality principle or principle of double entry, is a fundamental accounting principle that recognizes the double impact of each business transaction. According to this concept, every transaction affects two or more accounts in opposite ways, one being the debit and the other being the credit. This principle is based on the notion that for every action, there is a corresponding reaction. It ensures that the accounting equation, which states that assets equal liabilities plus owner's equity, remains in balance. Essentially, the dual aspect concept implies that a company's financial records must reflect the total impact of both the source and use of resources, providing a holistic view of the overall financial health of the business.

This mind map was published on 1 February 2024 and has been viewed 40 times.