The professional mathematicians of the Renaissance, the mathematici, included accounting in their teaching. Today, accounting practitioners use the four basic arithmetic operations—chiefly addition and subtraction, and occasionally division or multiplication—to calculate costs or ratios. Although they sometimes use exponentials or logarithms in present-value calculations, they rarely go any further. Nevertheless, increasingly sophisticated mathematical techniques can be brought to bear.
Double-entry bookkeeping
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The entries in each account (customer or supplier) are characterized by two components: the debit total and the credit total , with E denoting uses and R resources. The account can therefore be represented by an ordered pair of numbers , where . This gives us a two-dimensional vector space.
Throughout the history of accounting, four forms of writing have been used: pictograms, word signs, syllabic signs and alphabets.
Throughout history and in every country, only a limited number of account formats have been used. Alongside accounts with superimposed entries (Sumerian and Egyptian accounts), there are accounts with separate columns, in which one page of a ledger or document—say, the left-hand page—is devoted to positive changes (inflows, receipts, uses or debits), while the facing page on the right records negative changes (outflows, expenses, resources or credits). The third format uses paired columns, as in today's bank statements, where increases and decreases appear in adjacent columns on the same sheet. The fourth is matrix accounting, the most recently introduced.
