Question

describe the basic accounting equation how does the double-entry accounting system work

Answer 1

According to double entry accounting every transaction or event must be recorded in at least two accounts.That's the same concept behind accounting equation Assets = Liabilities + Equity

Lest take an example, I made an advertisement for cash $100. This Transaction will Decrease my asset side for $100 and also decrease my Equity Side By $100, after affecting this transaction my equation will remain equal.

Every modern accounting system is built on the double entry bookkeeping concept because every business transaction affects at least two different accounts. For example, when a company takes out a loan from a bank, it receives cash from the loan and also creates a liability that it must repay in the future. This single transaction affects both the asset accounts and the liabilities account.