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Golden Rules: 1. Real Account

The document discusses accounting concepts and golden rules for different types of accounts. It explains that real accounts record assets and liabilities, personal accounts record individuals and organizations, and nominal accounts record income, expenses, gains and losses. The golden rules specify that for real accounts debit records what comes in and credit records what goes out, for personal accounts debit records the receiver and credit records the giver, and for nominal accounts debit records expenses and losses while credit records incomes and gains. Several examples are provided to illustrate the application of these concepts and rules.

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55 views5 pages

Golden Rules: 1. Real Account

The document discusses accounting concepts and golden rules for different types of accounts. It explains that real accounts record assets and liabilities, personal accounts record individuals and organizations, and nominal accounts record income, expenses, gains and losses. The golden rules specify that for real accounts debit records what comes in and credit records what goes out, for personal accounts debit records the receiver and credit records the giver, and for nominal accounts debit records expenses and losses while credit records incomes and gains. Several examples are provided to illustrate the application of these concepts and rules.

Uploaded by

b_indhumathi
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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CONCEPT OF ACCOUNTING

 Real account e.g.: cash book


 Personal account e.g.: name of persons
Name of banks

Name of companies

 Nominal account e.g.: all expenses and incomes

Golden rules

1. Real account
 Debit : what comes in.
 Credit: what goes out.
E.g.: received cash towards capital.

2. In personal account
 Debit : the receiver.
 Credit: the giver.
E.g.: paid cash to balaji.

3. In nominal account
 Debit: all expenses and losses.
 Credit: all incomes and gains.
E.g.: paid salary by cash.
1.Ram Capital the giver cr

Cashwhat comes in.  dr

2.Cash what goes outcr

Iob bank the receiverdr

3.(credit purchase) all exp and lossesdr

Krishna tradersgivercr

4. purchase returnall income and gainscr


Krishna traders The receiverdr

5.credit salesall incomes and gainscr


Ravi&coreceiverdr

6. cashwhat comes inddr


Cash salesall incomes and gainscr

7.sales returnall exp and lossesdr


Ravi&cothe givercr

8.iob bankthe givercr


Krishna tradersthe receiverdr

9.iob bankthe receiverdr


Ravi&cothe givercr

10.cashwhat goes outcr


Petty cashwhat comes indr

11.furniturewhat comes indr


Cashwhat goes outcr

12.salaryall exp and lossessdr


Cashwhat goes outcr

13.cashwhat goes outcr


Cash purchaseall exp and lossessdr

14.conveyanceall exp and lossess ==> dr


Petty cashwhat goes outcr

15. stationriesall exp and lossessdr


Sri ram&cothe giver cr

16. Depreciationall exp and lossessdr


Furniturewhat goes outcr

Purchase return
Cr (purchase return)
Date Inv.no Parties name Amount
(Dr)
10.4.200 12 Krishna traders 5,000
7
12.4.200 44 Pravin traders 5,000
7

Credit sales
Cr (credit sales)
Date Inv.no Parties name Amount
Dr
15.4.200 1 Ravi & co 50,000
7
15.4.200 2 Kumar & co 50,000
7

Cash sales
Dr (cash) cr (cash sales)
Date Inv.no Parties name Amount
15.4.200 3 ---------------- 20,000
7

Credit sales
Cr (credit sales)
Date inv.no Parties name Amount
Dr
17.4.200 4 Ravi & co 50,000
7
17.4.200 5 Kumar & co 50,000
7

Sales return
Date Inv.no Parties name Amount
17.4.200 1 Ravi & co 5,000
7
17.4.200 5 Kumar & co 5,000
7

Payment made by cheque


Date Cheque.no Parties name Amount
20.04.200 153154 Krishna traders 30,000
7
20.04.200 153155 Pravin traders 30,000
7

Received cheque from


Date Ch.no Parties name Amount
23.4.200 302302 Ravi & co 75,000
7
23.4.200 116210 Kumar & co 75,000
7

Payment made by cash


Cr(cash)
Date Expenses Amount
25.4.0 Paid to petty cash 1,000
7
25.4.0 Paid to furniture 20,000
7
25.4.0 Salaries 10,000
7
25.4.0 Rent 4,000
7
25.4.0 E.b charges 3,000
7
25.4.0 Telephone charges 3,500
7
25.4.0 Cash purchase 5,000
7
Payment made by petty cash
Date Expenses Amount
30.04.200 Conveyanse 150
7
30.04.200 Postage 100
7
30.04.200 Stationeries 200
7
30.04.200 Staff welfare 100
7

Journal

30.04.2001

stationeries purchase from sriram & co for rs 1500/- credit.

Depreciation on furniture 10%.

Balance sheet: 3, 21,950.00

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