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    Account Types or Kinds of Accounts

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    coolchethan
    The document discusses three types of accounts: personal accounts, real accounts, and nominal accounts. Personal accounts are in the name of individuals or organizations. Real accounts represent tangible and intangible assets. Nominal accounts relate to expenses, losses, incomes, and gains.

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    Account Types or Kinds of Accounts

    Uploaded by

    coolchethan
    339 views14 pages
    The document discusses three types of accounts: personal accounts, real accounts, and nominal accounts. Personal accounts are in the name of individuals or organizations. Real accounts represent tangible and intangible assets. Nominal accounts relate to expenses, losses, incomes, and gains.

    Original Description:

    personal and real and nominal

    Original Title

    Types of Accounts

    Copyright

    © © All Rights Reserved

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    The document discusses three types of accounts: personal accounts, real accounts, and nominal accounts. Personal accounts are in the name of individuals or organizations. Real accounts represent tangible and intangible assets. Nominal accounts relate to expenses, losses, incomes, and gains.

    Copyright:

    © All Rights Reserved
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    339 views14 pages

    Account Types or Kinds of Accounts

    Uploaded by

    coolchethan
    The document discusses three types of accounts: personal accounts, real accounts, and nominal accounts. Personal accounts are in the name of individuals or organizations. Real accounts represent tangible and intangible assets. Nominal accounts relate to expenses, losses, incomes, and gains.

    Copyright:

    © All Rights Reserved
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    of 14

    Account Types

    Or
    Kinds of Accounts

    CLASSIFICATION OF
    ACCOUNTS

    All the accounting heads used in an organizational


    accounting system are divided into MAJOR
    THREE kinds.
    There are mainly three type of accounts in
    accounting:

    PERSONAL,

    NOMINAL ACCOUNTS

    REAL,

    AND

    CLASSIFICATION OF
    ACCOUNTS
    ACCOUNTS
    PERSONAL
    ACCOUNTS

    REAL
    ACCOUNTS

    IMPERSONAL
    ACCOUNTS

    NOMINAL
    ACCOUNTS

    PERSONAL ACCOUNTS
    Accounts in the name of persons are known as
    personal accounts.

    Personal

    Accounts

    subcategories:

    are

    Artificial,

    classified

    under

    Natural

    three
    and

    Representative
    Natural Personal Accounts: This type of personal accounts is
    includes all gods creations who have the ability to deal with, who, in
    most cases, are people. E.g. Kumars A/C, Adams A/C, etc.
    Artificial Personal Accounts: Personal accounts which are created
    artificially by law, such as corporate bodies and institutions, E.g. Pvt

    PERSONAL ACCOUNTS
    Representative Personal Accounts: Accounts which represent a
    certain person or a group directly or indirectly. E.g. Lets say that
    wages are paid in advance to an employee a wage prepaid account
    will be opened in the books of accounts.

    REAL ACCOUNTS
    ALL THE ASSETS OF A FIRM, which are tangible or intangible,
    fall under the category Real Accounts.
    TANGIBLE REAL ACCOUNTS are related to things that can be
    touched and felt physically. A few examples of tangible real accounts
    are building, machinery, stock, land, etc.
    INTANGIBLE REAL ACCOUNTS are related to things that cant
    be touched and felt physically. A few examples of such real accounts
    are goodwill, patents, trademarks, etc

    NOMINAL ACCOUNTS
    Accounts which are related to expenses,
    losses, incomes or gains are called Nominal
    accounts.

    RULES FOR DEBIT AND


    CREDIT
    Personal
    Account

    Debit the Receiver


    Credit the Giver
    Debit what comes in

    Real Accounts

    Nominal
    Accounts

    Credit what goes


    out
    Debit all Expenses
    and Losses
    Credit all Incomes
    and Gains

    Steps for finding the debit and


    credit aspects of a particular
    transaction
    Find out the two accounts involved in the
    transaction.
    Check whether it belongs to Personal,
    Real or Nominal account.
    Apply the debit and credit rules for the
    two accounts.

    Debit and Credit


    A debit is an accounting
    Definitions

    entry that either

    increases an asset or expense account, or


    decreases a liability or equity account. It is
    positioned to the left in an accounting entry.
    A credit is an accounting entry that either
    increases a liability or equity account, or
    decreases an asset or expense account. It is
    positioned to the right in an accounting entry.

    Journal
    Journal is the prime or original book of entry
    in which all transactions are recorded in the
    form of entries. Journalising is an act of
    recording or entering transactions in a
    Journal in the order of date.
    Date

    Particulars

    LF

    Debit
    Amount

    Credit
    Amount

    Journal Entry
    Jan 1, 1981 Prakash Started a business Rs.
    15,000/Date

    Particulars

    1981
    Jan 1

    Cash a/c
    Dr.
    To Prakashs Capital
    a/c
    (Being cash invetsed to
    business)

    LF

    Debit
    Amount

    Credit
    Amount

    15,000
    15,000

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