The principle of double entry states that: "for every debit entry, there must be a corresponding credit entry and for every credit entry, there must be a corresponding debit entry".
In double entry, we are made to understand that the Debit (Dr) account is the receiver (receiving account) while the Credit (Cr) account is the giver (giving account).
But it's obvious this rule does not apply to banks. Below is the reason why I said so.
In banks, if one (the giver) transfers a certain amount of money from his own account to someone else's account (the receiver), we will realize that the giver's account will be debited while the receiver's account will be credited. But remember double entry states that: we are to debit the receiver and credit the giver.
Now, the question to us is: Why do banks not follow the Principle of double entry?
You can drop your answers in the comment section. Let's interact.
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