TYPES OF ACCOUNTS

 The debit & credit is decided on the basis of some rules of double entry system. The rules can be explained as follows:-

TYPES OF ACCOUNTS

In double entry system the concerned accounts are classified in three types:-

1. Personal Accounts

2. Real Accounts

3. Nominal Accounts

1. PERSONAL ACCOUNTS:-

       In this type accounts of all people's i.e. artificial & natural persons are considered. Artificial i.e. Persons created by law. 

e.g. Bank, companies, Co-operative societies, Trusts, etc.

      Natural persons living persons means a human being. 

i.e. Mr.Joshi, Mrs.Kulkarni etc.

2. REAL ACCOUNTS:-

       In this type account of business properties, assets are considered. 

e.g. Cash A/c, Furniture A/c, Building A/c, Goods A/c etc.

3. NOMINAL ACCOUNTS:-

      In this type accounts of expenses and incomes of the business are considered.

e.g. Salary A/c, Rent A/c, Interest A/c, Commission A/c etc.