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    Golden Rules of Accounting

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    rex lasurus
    The document discusses the key concepts and rules of accounting. It explains that accounting involves systematically recording financial transactions and accounts. There are two main approaches to accounting - the traditional approach and modern approach. The traditional approach categorizes accounts as personal, real, or nominal accounts. It provides the golden rules for debiting and crediting each type of account. The modern approach categorizes accounts as assets, liabilities, capital, revenue, or expenses. It also outlines the golden rules for debiting and crediting each type of modern account.

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    Golden Rules of Accounting

    Uploaded by

    rex lasurus
    12 views11 pages
    The document discusses the key concepts and rules of accounting. It explains that accounting involves systematically recording financial transactions and accounts. There are two main approaches to accounting - the traditional approach and modern approach. The traditional approach categorizes accounts as personal, real, or nominal accounts. It provides the golden rules for debiting and crediting each type of account. The modern approach categorizes accounts as assets, liabilities, capital, revenue, or expenses. It also outlines the golden rules for debiting and crediting each type of modern account.

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    The document discusses the key concepts and rules of accounting. It explains that accounting involves systematically recording financial transactions and accounts. There are two main approaches to accounting - the traditional approach and modern approach. The traditional approach categorizes accounts as personal, real, or nominal accounts. It provides the golden rules for debiting and crediting each type of account. The modern approach categorizes accounts as assets, liabilities, capital, revenue, or expenses. It also outlines the golden rules for debiting and crediting each type of modern account.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pptx, pdf, or txt
    12 views11 pages

    Golden Rules of Accounting

    Uploaded by

    rex lasurus
    The document discusses the key concepts and rules of accounting. It explains that accounting involves systematically recording financial transactions and accounts. There are two main approaches to accounting - the traditional approach and modern approach. The traditional approach categorizes accounts as personal, real, or nominal accounts. It provides the golden rules for debiting and crediting each type of account. The modern approach categorizes accounts as assets, liabilities, capital, revenue, or expenses. It also outlines the golden rules for debiting and crediting each type of modern account.

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    Golden Rules of
    Accounting
    Presented by:
    Neander Lambha Kharkongor
    BBA Sec-C
    z
    What is Accounting?

     Accounting is the process of systematically recording,


    classifying identifying, measuring, interpreting and managing
    financial accounts.
    z
    Types of Accounts

     In accounting we record all day to day transaction of business.


    We have to record this with some standard rules or principle of
    accounting .

     With the help of these rules we can know which account will be
    credited or debited .

     These rules also called as approaches are of two types :

     1. Tradition Approach

     2. Modern Approach
    z
    Traditional Approach
     There are three types of accounts in traditional approach :-

     1.Personal A/c :These accounts types are related to persons. These


    persons may be natural person or artificial persons e.g partnership firms,
    companies etc……

     2.Real A/c :These account types are related to assets or properties. e.g


    Buildings, Cash etc

     3. Nominal A/c :These accounts types are related to income or gains and
    expenses or losses. e.g Rent , Salary ,commission etc
    Golden Rules for Traditional Approach
    z

    1. Personal A/c : Debit the Recevier


    Credit the Giver

    2. Real A/c : Debit what comes in


    Credit what Goes out

    3. Nominal A/c : Debit all Expenses & Losses


    Credit all Income & Gains
    z
    Modern Approach
     There are Five types of accounts in modern Approach :-

     1.Assets A/c : An asset account is an account that records the assets owned by a company,
    individual or country.

     2.Liabilities A/c : A liability account stores all legally binding obligations payable to a third party.
    These are obligations or debts payable by the business

     3.Capital A/c : A Capital account is used to record the owners contribution to the business i.e in cash
    or asset . Capital account is also called Owner’s Equity

     4. Revenue A/c : Revenue Accounts are those accounts that report the income of the business
    earned from selling products or services to their customers.

     5. Expenses A/c : Expenses Accounts records i the money spent or cost incurred by a business in
    order to generate revenue .
    :        
    :        

    Golden Rules for Modern Approach


    z

     1. Assets : Debit Credit

     2. Liabilities : Debit Credit

     3. Capital : Debit Credit

     4. Revenue : Debit Credit

     5. Expenses : Debit Credit

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