Types & Golden Rules Of Accounts

Types of Accounts

1) Personal Accounts

All individuals, societies, trusts, banks and companies' accounts are called personal accounts.

Examples:- Trupti A / c, Krishna Sales A / c, Anil Traders A / c, State Bank of India A / c

2) Real Accounts

Real Assets include all Assets and Goods accounts.

Examples:- Cash A / c, Furniture A / c, Building A / c

3) Nominal Accounts

All the income and expenses related to the business fall under the nominal account.

Examples:- Salary A / c, Rent A / c, Commission A / c, Advertisement A / c, Light Bill A / c

Golden Rules of Accounts

While transacting, we have to decide on a debit or credit side. Here are the following rules:

Personal Accounts

Payee debit

Credit to the giver

Debit: The Receiver or Debtor

Credit: The Giver or Creditor

Real Accounts

Debit the item that came into business

Credit the thing that goes by trade

Debit: What comes in

Credit: What went out

Nominal Accounts

Debit all types of expenses and losses

Credit all types of income and benefits

Debit: All Expenses & Losses

Credit: All Incomes & Gains