You've probably heard the saying, "Money doesn't grow on
trees." It means that money must come from somewhere---it
doesn't just "appear." Double-entry accounting is a method
of record-keeping that lets you track just where your money
comes from and where it goes.
Using double-entry means that money is never gained nor
lost---it is always transferred from somewhere (a source
account) to somewhere else (a destination account). In
GnuCash, this transfer is known as a transaction, and each
transaction requires at least two accounts.
Contra entry is journal entry.It will be effect in two books
one is cash book and another one is bank book.Now we will
be take cash deposit in bank and entry will be come like
Bank A/c dr ***
to cash A/c ****
(cash deposit in bank)
now here bank balance is increase and cash balances is
dicrease and it is effected in both books.
Every journal entry must made based on the accounting principles.
Every entry has dual aspect contra entry is not exceptable. Of course contra entry is also a journal entry but every entry can not be a contra entry.Contra entry has an unique quality i.e it takes place in both sides of the accounts but not an every entry.that is the unique difference which makes the contra entry to be separated from the other.that is the difference......
what will be the journal entry-discount rs 2000 allowed to
mr x.and discount received rs 2000 from mr x.actually i am
confused that in the first entry both discount a/c and mr x
a/c will be credited as per the accounting standards.please