ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Compilation of a BoP Account follows a double-entry accounting system where every external transaction is presented by two entries, a credit and a debit, with exact equal values but in opposite sign. The two BoP entries are used to denote the giving and receiving sides of external transactions.

Detailed explanation-2: -3 Balance of Payment. A BOP is the statistical record of a country’s international transactions over a certain period of time. In this double-entry bookkeeping system, any receipt from a foreigner is recorded as a credit and payments to foreigners are recorded as debits.

Detailed explanation-3: -A double-entry system is the method of recording transactions twice in the accounting. Every transaction is recorded with two effects one is the debit side and the other is the credit side. The amount recorded on both sides is equal. The total of a debit side is equal to the total credit side.

Detailed explanation-4: -Double-entry accounting is a system of bookkeeping where every financial transaction is recorded in at least two accounts. A double-entry system provides a check and balance for each transaction, which helps ensure accuracy and prevent fraud.

Detailed explanation-5: -The correct answer is Double Entry System. An accounting system that affects at least two accounts simultaneously with every transaction is called a double-entry system. It recognizes every transaction with a dual effect. In a double-entry system If one account is debited, any other account must be credited.