GOLDEN RULES OF ACCOUNTING

NAME :- ISHITA DEY

SEMESTER :- 3
ROLL NUMBER - UG/09/BED/2022/041
REGISTRATION NUMBER - AU/2022/0008137
DEPARTMENT :- SCHOOL OF EDUCATION
 WHY DO WE NEED THE GOLDEN RULES
OF ACCOUNTING?

JOURNAL ENTRIES CANNOT BE RECORDED WITHOUT

SOME RULES. THE RULES WHICH ARE USED TO RECORD A
JOURNAL ENTRY ARE CALLED GOLDEN RULES OF
ACCOUNTING.
 RULES OF DEBIT AND CREDIT
 RULES OF DEBIT AND CREDIT UNDER THE TRADITIONAL APPROACH
 REAL ACCOUNT

 Debit What Comes In :-

Cash received from Ram: Here, cash account will be debited as
cash is coming into the business.

 Credit What Goes Out :-

Cash withdrawn from business: Here, cash account will be
credited as cash is going out from the business.
 PERSONAL ACCOUNT

 Debit the Receiver :-

Cash paid to Mohan: Here, Mohan’s account will be debited, as
Mohan has received cash.

 Credit the Giver :-

Cash received from Mohan: Here, Mohan’s Account will be
credited as Mohan has given cash.
 NOMINAL ACCOUNT
 Debit all Expenses and Losses :-
Salary paid in cash: Here, salary will be debited as business is
giving salary which is an expense.

 Credit all Incomes and Gains :-

Interest received from bank: Here, interest received will be
credited as business is receiving interest from bank which is an
income.
 RULES OF DEBIT AND CREDIT
UNDER THE MODERN APPROACH

ACCOUNT INCREASE DECREASE

ASSETS DEBIT CREDIT

EXPENSES DEBIT CREDIT

LIABILITIES CREDIT DEBIT

EQUITY CREDIT DEBIT

INCOME CREDIT DEBIT