How would I categorise a personal account?
We can classify the accounts as per the traditional classification under the following heads:
- I. Personal Accounts. …
- II. Impersonal Accounts. …
- Personal Account: Debit the Receiver. …
- Real Account: Debit what comes in. …
- Nominal Account: Debit all expenses and losses. …
- Representative Personal Account: Debit the Debtor.
What are the categories of personal accounts?
Real, Personal and Nominal accounts are the traditional classification of account types in accounting, however, personal accounts are further distinguished under three categories such as Natural, Artificial, and Representative.
What are the three kinds of personal accounts?
Accounts are classified into following categories: Personal Account. Natural Personal Account. Artificial Personal Account.
How do you categorize personal expenses?
The Essential Budget Categories
- Housing (25-35 percent) …
- Transportation (10-15 percent) …
- Food (10-15 percent) …
- Utilities (5-10 percent) …
- Insurance (10-25 percent) …
- Medical & Healthcare (5-10 percent) …
- Saving, Investing, & Debt Payments (10-20 percent)
What is personal account in accounts?
A personal account is an account for use by an individual for that person’s own needs. It is a relative term to differentiate them from those accounts for business or corporate use.
How are personal accounts classified 11?
Explanation: Outstanding wages is classified as a personal account and not a nominal account. This account represents the accounts of all those persons to whom wages have not been paid and, hence, are outstanding. Therefore, it is termed as ‘Representative Personal Account’ or simply personal account.
Which of the following is a personal account?
These accounts are related to individuals, firms, companies, etc. A few examples of personal accounts include debtors, creditors, banks, outstanding/prepaid accounts, accounts of credit customers, accounts of goods suppliers, capital, drawings, etc. Was this answer helpful?
Is cash a personal account?
The sale account is a Nominal account and the Debtors Account is a Personal account. Hence the Golden Rule to be applied is: Debit the receiver.
Golden rules of accounting.
| Transaction | Accounts involved | Type of Accounts |
|---|---|---|
| Deposit Rs.10,000 in Bank | Bank Account | Real Account – Asset account |
| Cash Account | Real Account – Asset account |
Is rent a personal account?
(i) Rent Account is a Nominal Account, but Outstanding Rent Account is a Personal Account. Rent Received in Advance Account is a Personal Account. Prepaid Rent Account is a Personal Account. (ii) Salaries or Wages Account is a Nominal Account but Outstanding Salaries or Outstanding wages Account is a Personal Accounts.
What comes under nominal account?
Nominal Accounts are accounts related to and associated with losses, expenses, income, or gains. Examples include a purchase account, sales account, salary A/C, commission A/C, etc. The outcome of a nominal account is either profit or loss, which is then ultimately transferred to the capital account.
What’s a nominal account?
Nominal accounts are used to keep track of financial transactions over a set period of time, usually a year. They begin with a zero balance and are closed at the end of each accounting year. This makes it easy to see the financial transactions for just that period.
Is capital account a personal account?
Capital account is the account of a natural person, i.e. an account of person who is alive. Hence, it can be classified as a personal account.
Is drawing a personal account?
Since drawings are used by the businessman for personal purposes it is a personal account.
What is the rule of personal account?
The golden rule for personal accounts is: debit the receiver and credit the giver. In this example, the receiver is an employee and the giver will be the business. Hence, in the journal entry, the Employee’s Salary account will be debited and the Cash / Bank account will be credited.