Contents recorded in the balance of payments account:

1: Goods

Including general goods, goods for processing, goods repair, and various means of transportation Procurement, non-monetary gold;

2: Services

Including transportation, tourism, communications, construction, insurance, finance, computers, exclusive royalties, license fees (copyright, etc.) , personal entertainment, cultural services, other commercial services and government services not mentioned elsewhere;

3: Income

Including employee income (employee compensation) and investment income (direct investment and indirect investment).

4: Current transfers

Including transfers other than the transfer of ownership of fixed assets, transfers of funds conditioned on acquisition or abandonment of fixed assets, cancellation of debts for which creditors do not want repayment, etc. Other transfers, such as insurance premiums, overseas remittances, etc.

Recording principles:

When specifying the balance of payments, there is a prescribed accounting principle. People call this the retest accounting principle. This means that a debit records an increase in an asset and a decrease in a liability, while a credit records a decrease in an asset and an increase in a liability. So what is a loan and what is a lender? Credits are credited only to items that generate foreign exchange earnings for the country. Instead, the decreasing item is recorded as a debit.

The three major rules of double-entry accounting:

1: Any transaction must involve two aspects: debit and credit: if there is a loan, there must be a credit, and the loans must be equal

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2: Debit: both real resources and financial assets represent an increase in holdings

3: Credit: both real assets and financial assets represent a decrease in holdings

Supplement: What is the balance of payments

The International Monetary Fund defines the balance of payments as: The balance of payments is a statistical statement that systematically records the economic performance during a certain period of time. The subject’s transactions with the rest of the world. Most transactions are between residents and non-residents.