The business events though they have to get turned into something called journal entries, and accounting, there's a flow of things through different buckets of the accounts and the way the money changes over time. Money flows into your checking account, it then might flow into your investment account, it might flow out of your investment account into paying for college. That flow of things is what's reflected by journal entries. You've probably heard the term debit and credit before in a certain sense, those are simply terms for plus and minus a debit and a credit. Debit is flowing into a credit is flowing out of not always accurate and it can be in many different kinds of cases. But you can think of it in a simple way that way.

So we take the business event which is a simple transaction, and we have to start representing this flow. How It changes to different things as a point in time to get to a financial system. That process is called creating journal entries. It's detecting what are the flow and the debits and credits that go along with each transaction.