Double-entry bookkeeping system

Okay kiddo, so you know how you have money in your piggy bank and you also know how much money your friend has in her piggy bank, right? That's kind of like what double-entry bookkeeping is.

In this system, we keep track of all the money coming in and going out of a business. Every time we record something, we make sure to record it twice – once in the "debit" column and once in the "credit" column.

Think of it like a seesaw. When one side goes up, the other side goes down. So, when we add money to our piggy bank, we also need to subtract that same amount of money from our "cash account". And when we spend money on something, we need to add that same amount of money to our "expense account".

This system helps us keep track of where all the money is going and ensure that our financial records are accurate. It also helps us catch any mistakes that might have been made.

So, just like how you keep track of your money, businesses use double-entry bookkeeping to keep track of their money too.