What is account goladan rules with explain

Question

Accepted Answer

Account golden rules are basic principles of accounting that help in maintaining accurate financial records.

There are three golden rules of accounting: Debit the receiver, Credit the giver; Debit what comes in, Credit what goes out; Debit expenses and losses, Credit income and gains.
These rules are used to record transactions in the journal and ledger.
For example, if a company receives cash from a customer, the entry would be: Debit Cash (what comes in), Credit Accounts Receivable (what goes out).
The golden rules ensure that the accounting equation (Assets = Liabilities + Equity) remains in balance.
They also help in preparing accurate financial statements and analyzing the financial health of a business.

Popular interview questions of Executive Accountant