I am reading a couple of textbooks at the same time for the new term of 2009. I wish with you these few interesting paragraphs challenging the existence of the double-entry system.
The books that I am reading credited the first organised written thought on double entry system to this Franciscan monk called Luca Pacioli and his now famous work called “Summa de Arithmetica, Geometrica, Proportioni et Proportionalita” published in Venice back in 1494. It is simply a system of debits and credits, where the debits going to the left and credits going to the right. It is a system of subtraction-by-opposition ie. put on the opposite side if you want to minus.
Then a clever chap (possibly someone who cannot handle double entry) asked, “Why can’t we use positive and negative numbers instead of T-accounts?”
So if you want to pay salary, you just add to Salary expenses and minus the same amount from the Cash/Bank.
FYI – negative numbers were only accepted in the mathematics world in 17th century while double entry has been around since 13th/14th century.
In the 21st century’s classes of Edgar, both systems are used in our learning programmes.