But what was that system? In essence, Pacioli’s system has two key elements. First, he describes a method for taking an inventory and then keeping on top of day-to-day transactions using two books—a rough memorandum and a tidier, more organized journal. Second, he uses a third book—the ledger—as the foundation of the system, the double entries themselves. Every transaction was recorded twice in the ledger: if you sell cloth for a ducat, say, you must account for both the cloth and the ducat. The double-entry system helps catch errors, because every entry should be balanced by a counterpart.
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