Single-Entry vs. Double-Entry

Bookkeeping can also be done as single-entry or double-entry. In single-entry bookkeeping, each transaction is recorded as a single entry while, in double-entry bookkeeping, a transaction is recorded twice.

For example, if you make a $10 sale, in a double-entry system, this transaction is recorded as a $10 gain in your income ledger and as a $10 deduction to the total value of your inventory. Meanwhile, in single-entry bookkeeping, the transaction is only recorded once.

Single-entry bookkeeping is much simpler than double-entry bookkeeping. However, if your business is incorporated or if it’s your sole source of income then the single-entry will not do. Double-entry bookkeeping is recommended because there’s less room for error, and this makes it a better choice for balancing more complex books. Nowadays, thanks to cloud accounting software’s, double-entry is not that much more complicated than single-entry, and the process is almost completely automated.