RB User Guide > Appendices > Accounting Basics
Five basic accounts
Basic accounting rules group all financial transactions into five fundamental types of “accounts.” That is, everything that accounting deals with can be placed into one of these five accounts:
- Assets – things you own (such as accounts receivable or cash)
- Liabilities – things you owe (such as resources payable or refund)
- Equity – overall net worth (assets minus liabilities)
- Income – increases net worth
- Expenses – decrease net worth
NEXT: The balance between assets, liabilities and equity
The accounting equation is the basis of double-entry accounting.
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