What is the difference between a single entry and a double entry bookkeeping system?

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What is the difference between a single entry and a double entry bookkeeping system?

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A. A single entry bookkeeping system is used for sole proprietor businesses and records only income and expenses by category. A double entry bookkeeping system is used for all other entity types and records each and every transaction using two entries, a debit and a credit. This system records debit transactions relating to purchases, expenses and increases in assets and credit transaction relating to income and increases in liabilities of the company.

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