What is golden rules of accounts?

Question

Accepted Answer

The golden rules of accounts are basic principles that guide the recording of financial transactions.

The golden rules include the Personal Account, Real Account, and Nominal Account.
Personal Account: Debit the receiver, credit the giver. For example, when cash is received from a customer, debit the cash account and credit the customer's account.
Real Account: Debit what comes in, credit what goes out. For example, when purchasing inventory, debit the inventory account and credit the cash account.
Nominal Account: Debit all expenses and losses, credit all incomes and gains. For example, when recording salary expenses, debit the salary account and credit the cash account.

Accepted Answer

The Golden Rules of Accounting guide how transactions are recorded based on the type of account involved:

Personal Account: Debit the receiver, credit the giver. This applies to transactions with people or entities.

Real Account: Debit what comes in, credit what goes out. This relates to physical or tangible assets like cash or equipment.

Nominal Account: Debit expenses and losses, credit incomes and gains. It governs income and expense items.

These rules ensure accurate financial records by properly classifying and recording debits and credits for each type of account.

Accepted Answer

Real account =Debit- what comes in  
                        =Credit- what goes out Personal account=Debit-The 
                                  Receiverr
                                =Credit- The giver
Nominal account=Debit- All Expenses and loss
                              =Credit- All Incomes and gain

What is golden rules of accounts?

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