[jasim]

> Instead of using negative numbers, Accounts have normal balance: normal credit balance literally means that they are normal when its associated entries with type credit have a total amount that outweighs its associated entries with type debit. The reverse is true for normal debit balance.

But that is an interpretation made by the viewer. A customer typically is an asset account, whose balances are in the debit column. But if we somehow owe them money because let's say they paid us an advance, then their balance should be in the credit column. The accounting system need not bother with what the "right" place for each account is.

It is quite practical to have only a simple amount column rather than separate debit/credit columns in a database for journal entries. As long as we follow a consistent pattern in mapping user input (debit = positive, credit = negative) into the underlying tables, and the same when rendering accounting statements back, it would remain consistent and correct.

[fendy3002]

> It is quite practical to have only a simple amount column rather than separate debit/credit columns in a database for journal entries. As long as we follow a consistent pattern in mapping user input (debit = positive, credit = negative) into the underlying tables, and the same when rendering accounting statements back, it would remain consistent and correct.

Another benefit of Credit / Debit side on double-entry bookkeeping is you need to balance both side in a single transaction. Say if the user account 2003201 is in Credit and it got an addition of 1000 value, a same value need to be added on Debit side. If it's (1) a cash topup, then 1000 value need to be added to Cash account (let's say 1001001) on Debit side. Otherwise if it's a transfer (2) from another user account 203235, then the account need to be Debited 1000 value as well.

It's Asset = Liabilities + Equity, while the left equation is Debit (which increase value when a Debit transaction happen, and the right equation is Credit, which increase when a Credit transaction happen. In (1) case, the cash account increase since it's on Debit account, while in (2) case, the user account decrease because it's a debit transaction on Credit account.

[jasim]

With negative/positive, the invariant would be sum(amount) = 0; with your approach, it would be sum(debit-credit)=0. Both are valid, it is just two ways of expressing the same thing.

I think it is useful to think about double-entry book-keeping in two layers. One is the base primitive of the journal - where each transaction has a set of debits and credits to different accounts, which all total to 0.

Then above that there is the chart of accounts, and how real-world transactions are modelled. For an engineer, to build the base primitive, we only need a simple schema for accounts and transactions. You can use either amount (+/-ve), or debit/credit for each line item.

Then if you're building the application layer which creates entries, like your top-up example, then you also need to know how to _structure_ those entries. If you have a transfer between two customer accounts, then you debit the one who's receiving the money (because assets are marked on the debit side) and credit the other (because liabilities are on the credit side). If you receive payment, then cash is debited (due to assets), and the income account is credited (because income balances are on the credit side).

However, all of this has nothing to do with how we structure the fundamental primitive of the journalling system. It is just a list of accounts, and then a list of transactions, where each transaction has a set of accounts that get either debited/credit, with the sum of the entire transaction coming to 0. That's it -- that constraint is all there is to double-entry book-keeping from a schema point.