Various types of accounts,rules regarding debit credit

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Information about Various types of accounts,rules regarding debit credit

Published on December 18, 2016

Author: abinrjky

Source: slideshare.net

1. VARIOUS TYPES OF ACCOUNTS,RULES REGARDING DEBIT & CREDIT group 2 sub group 1 PUNEET SURI ,ABIN BABU ,POORVA RATHORE ,DEVESH VARMA ,MOHIT MISRA

2. CLASSIFICATION OF ACCOUNTS TYPES OF ACCOUNTS PERSONAL ACCOUNTS NATURAL PERSON’S PERSONAL ACCOUNTS ARTIFICIAL PERSON’S PERSONAL ACCOUNTS REPRESENTATIVE PERSONAL ACCOUNTS IMPERSONAL ACCOUNTS REAL ACCOUNTS TANGIBLE REAL ACCOUNTS INTANGIBLE REAL ACCOUNTS NOMINAL ACCOUNTS

3. PERSONAL ACCOUNTS  RECORD THE TRANSACTION RELATING TO :-  INDIVIDUALS  FIRMS  INSTITUTIONS  ORGANISATIONS  CORPORATIONS  BANKS  SOCIETIES  CLASSIFIED INTO THREE CATEGORIES 1. NATURAL PERSON’S PERSONAL ACCOUNT 2. ARTIFICIAL PERSON’S PERSONAL ACCOUNT 3. REPRESENTATIVE PERSONAL ACCOUNT

4.  NATURAL PERSON’S PERSONAL ACCOUNT-  RECORD THE TRANSACTIONS RELATING TO HUMAN BEINGS  FOR EXAMPLE RAM’S ACCOUNT, SITA’S ACCOUNT ETC  ARTIFICIAL PERSON’ PERSONAL ACCOUNT-  RECORD TRANSACTIONS RELATING TO ARTIFICIAL PERSONS  HAVE SOME EXISTANCE IN EYES OF LAW  CAN BE CREATED AS WELL AS DISSOLVED BY LAW ONLY  FOR EXAMPLE ANY FIRM, CLUB, COLLEGE, TRUST ETC.  REPRESENTATIVE PERSONAL ACCOUNT-  INDIRECTLY REPRESENTS A GROUP OF PERSONS  NATURE IS SIMILAR & THEIR NUMBER IS LARGE  FOR EXAMPLE PREPAID, SALARY, WAGES ETC.

5. IMPERSONAL ACCOUNTS  OTHER THAN PERSONAL ACCOUNTS  DIRECTLY RELATED TO CUSTOMERS & SUPPLIERS OF A BUSINESS  CLASSIFIED INTO TWO CATEGORIES 1. REAL ACCOUNTS 2. NOMINAL ACCOUNTS

6. REAL ACCOUNTS  RECORD TRANSACTIONS RELATING :- • ASSETS • PROPERTIES • POSSESSIONS  CLASSIFIED INTO TWO CATEGORIES a) TANGIBLE REAL ACCOUNT • RECORD TRANSACTIONS RELATING TO TANGIBLE THINGS • THOSE WHICH CAN BE SEEN, TOUCHED, MEASURED, & FELT • LAND,BUILDING,PLANT AND MACHINERY. b) INTANGIBLE REAL ACCOUNT • RECORD TRANSACTIONS RELATED TO INTANGIBLE THINGS • CANNOT BE TOUCHED OR SEEN BUT CAN BE MEASURED IN VALUE

7. NOMINAL ACCOUNTS  RECORD TRANSACTIONS RELATING TO  EXPENSES  LOSSES  INCOME  GAIN

8. Rules regarding debit and credit or double entry system • Journal and journalising • Rules can be based on • Traditional approach • Modern approach Rules regarding personal accounts Rules regarding real accounts Rules regarding nominal accounts

9. ACCOUNTS PERSONAL DEBIT THE RECEIVER CREDIT THE GIVER IMPERSONAL REAL DEBIT WHAT COMES IN CREDIT WHAT GOES OUT NOMINAL DEBIT ALL EXPENSES & LOSSES CREDIT ALL INCOMES & GAINS

10. Defects of traditional methods  Classification of accounts to some extend is rigid  There are some accounts which cannot be conveniently put under any of the categories  Sometimes rules fail to give proper explanation

11. Modern approach  Based on accounting equation  Assets +expenses = liabilities +capital+ revenue/ profit and in each transaction  Debit = credit increase in any aspect is debit and decrease is credit Above mentioned approach doesn't have any shortcoming

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