Classification of Accounts:

Accounts can be classified into Personal account

and impersonal account

 Personal  Impersonal
Account Account
1 Natural Personal
 Real account
Account Tangible /Intangible Real
2 Artificial Personal A/c
Account  Nominal account

3 Representative
Personal A/c
 Personal Account:

 Natural Personal Account: They include accounts of human

beings E.g. Mohan’s account,shalu’s account, sandesh’s Account
 Artificial Personal Account: These Accounts do not have a
physical existence as human beings but they work as personal
accounts. These are treated as artificial persons for the recording of
business transactions. For e.g. firms accounts, Companies
accounts, Any Institutions a/c, Any Bank a/c
 Representative Personal Account: This account represents a
particulars person or group of persons. For e.g., if the salaries of
the month of December are not paid to the employees, the amount
payable to these employees will be added and put under one
common title “salaries outstanding Account”, other e.g. prepaid
insurance account, accrued Interest Accounts unearned
commission Accounts.
 Real account:

 This account include all properties and assets of

the business, it is measured in terms of money.
These accounts can be classified in the following
two categories.
 Tangible Real Account: these accounts are
those accounts which have a physical existence
& it can be touched, felt, measured, purchased,
sold etc. e.g. stock, furniture, Land, building
 Intangible Real Account: These accounts
represent such things which can not be touched,
but of course their value can be measured in
terms of money e.g. goodwill, patents trade mark
copyright accounts etc.

 Nominal account:
 This account incorporates items relating to
Expenses and losses and incomes and gains.
E.g. salaries rent discount allowed bad debts
etc.
Identify the following Accounts:
 Rent: Nominal
 Salaries Nominal
 Interest
Nominal
 Ram’s Capital
 Singh & Co. Personal
 Arshad Personal
 Machinery Personal
 Furniture Real
 Telephone Charges Real
 Wages Nominal
 Bank Nominal
 Cash Real
 Insurance
Real
 Commission
Nominal
 Reliance & Co.
Nominal
Personal
RULES FOR RECORDING
PERSONAL ACCOUNT:

DEBIT THE RECIEVER

CREDIT THE GIVER
 RULES FOR RECORDING
NOMINAL ACCOUNT:

DEBIT ALL LOSSES AND EXPENSES

CREDIT ALL GAINS AND
PROFITS
Rules For Recording
Real Account:
DEBIT WHAT COMES IN

CREDIT WHAT GOES OUT

 JOURNAL PROFORMA
Date Particulars L.F. Debit Credit

         

         

         

         

         

         

         

         

         
Journal posting

Personal Account: Paid Rs. 1000 to Hari:

Dat Particulars L.F Debit Credit

.
e

     
Hari (debit the receiver) Dr. 1000

     
To Cash a/c 1000

       
(For Cash paid to Hari)
Received Rs. 500 from Mohan:

Dat Particulars L.F Debi Credit

e . t

  Cash a/c Debit (Debit what comes in )   500  

Dr.

  To Mohan (Credit the Giver)     500

  (For Cash received from Mohan)      

Real account: Furniture
purchased:Rs.1000/-

Date
Particulars L.F Debit Credit
.
  Furniture a/c (Debit what comes in) Dr.    
1000

  To Cash a/c (Credit what goes out)    

1000

       
(For Cash received from Mohan)
Nominal account: Rs. 7000 salaries paid to employees:
 

Date Particulars L.F. Debit Credit

     
Salaries A/c Dr. 7000
(Debit all losses and expenses)

     
To Cash a/c (Credit what goes out) 7000

       
(For Salaries paid)
Q1 Pass Journal Entries for the following transaction and post them into Ledgers:
-
Date Transaction Amount
200x
April
1st
Shyam Sunder started business with cash 200000

-- 3rd Purchased furniture for cash 20000

5 Purchased goods for cash 50000

8 Purchased goods ----From Vishal Trading Co. 25000

From Mohan Garments for Cash 16000

10 Returned goods to Vishal Trading Co. 5000

14 Paid cash to Vishal Trading Co. in full settlement of

their account,After deducting 1% Cash discount

15 Sold goods for cash 40000

16 Sold goods to Hero Limited, 10 % trade 30000
discount
20 Shyam sunder Withdrew from business for 10000
his personal use – cash 4000
Goods

22 Received from Hero Limited 8850

Discount Allowed 150

25 Sold goods to Hansraj Ltd. For cash 12000

28 Purchased goods from, Pawan Bros 2400

30 Paid for ---------rent 2000

Salaries 4000
Date Particulars L. Debit Credit
200x F.
Apri   200000  
Cash A/c (Debit What Comes In) Dr
l1st
      200000
To Capital a/c (Credit The Giver)
       
(Being business started with cash)
” 3rd   20000  
Furniture A/c (Debit What Comes In) Dr
      20000
To Cash A/c (Credit what goes out)
       
(Being Furniture Purchased)
” 5th   50000  
Purchase A/c (Debit What Comes In) Dr
      50000
To Cash A/c (Credit what goes out)
       
(Being goods purchased for cash)
”   41000  
Purchase A/c (Debit What Comes In) Dr
8th
      25000
TO Vishal trading Co. (Credit The Giver)  
      16000
To Cash A/c (Credit what goes out)
       
(Being goods purchased from Vishal T
Co.& for cash)
” Vishal Trading Co. (Debit the Receiver) 20000
14th Dr
To Cash A/c (Credit what goes out) 19800

To Discount (Credit All losses and 200

expenses)
(Being Vishal Trading Co. accounts settled at 1 %
discount)
” Cash A/c (Debit What Comes In) Dr 40000
15th
To Sales A/c (Credit what goes out) 40000

(Being goods sold for cash)

” Hero Ltd. (Debit the Receiver) Dr 27000
16th
To Sales A/c (Credit what goes out) 27000

(Being goods sold for cash trade & Discount

allowed @10%)
” Drawings A/c (Debit the Receiver) Dr 14000
20th
10000
To Cash A/c (Credit what goes out)
4000
To Purchase A/c (Debit What goes out)
(Being goods & cash withdraw for personal use
by the Prop.)
” 22nd   8850  
Cash A/c (Debit What Comes In) Dr
  Discount A/c (Debit All losses and expenses)Dr   150  

      9000
To Hero Ltd. (Credit The Giver)
       
(Being cash received & discount allowed)
” 25th   12000  
Cash A/c (Debit What Comes In) Dr

      12000
To Sales A/c (Credit what goes out)
       
(Being goods sold for cash )
” 28th   2400  
Purchase A/c (Debit What Comes In) Dr

      2400
To Pawan Bros (Credit The Giver)
  (Being goods purchased from Paswan Bros)      

” 30th   2000  
Rent A/c (Debit All losses and expenses) Dr

  Salaries A/c (Debit All losses and expenses) Dr   4000  

    6000
To Cash A/c (Credit what goes out)
       
(Being rent and Salaries paid)