TechnologyEurope
Double-entry bookkeeping
The accounting that lets you see whether something actually pays
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The method was in use among Italian merchants long before, but printing spread it across Europe. Goethe called it "one of the finest inventions of the human mind". Without it capital cannot be distinguished from income, and so there can be no joint-stock companies, no investment and no modern economic management.
For children
By recording every transaction twice — where the money came from and where it went — you can check that the books balance, and see whether the business is making a profit. Luca Pacioli wrote the method down in 1494.
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