Tally.ERP9 Basic Accounting Part-1

TYPES OF ACCOUNT:




1. Personal account (transaction relating to person).

2. Real account (transaction relating to properties and assets).

3. Nominal account (transaction relating to income and expenses).




PERSONAL ACCOUNT: 

Accounts recording transaction with a person or group of persons are known as personal account.




The rule for personal account is: 

Debit the receiver

Credit the giver.




The personal account are the following types:

Natural persons: 

an account recording transaction with an individual human being is termed as natural person.




Example: kamal’s account , mala’s account etc.




Artificial or legal account:

 an account recording financial transaction with an artificial person created by law or

other wise is termed as an artificial person.







Example: firm’s account, limited account, co-operative account etc.




Group/Representation personal account:

representing a person or or persons is known as representative personal account.




When account are of a similar nature and their number is large, it is better tot group the murder one head and open representative personal account




Example: prepaid insurance, outstanding salaries, rent, wages, etc;

when a person start business, he is known as proprietor. This proprietor is represented by capital account for that entire he invests in business and by drawing accounts for all that which he withdraws from business. So, capital accounts and drawings accounts are also personal accounts.




REAL ACCOUNT:

as a real account.




The rule for the real accounts is:

 Debit what comes in

Credit what goes out.




Real account can be further classified into two parts:

1. Tangible real account.

2. Intangible real account.




Tangible real account: these accounts represent assets and properties which can be seen, touched, felt, measured, purchased and sold.




Example: machinery account, cash account, furniture account, stock account etc.




Intangible account: these accounts represent assets and properties which can be seen, touched, felt, but they can be measured in terms of money.




Example: goodwill accounts,

 patents accounts,

 trademarks account,

 copyrights account, etc.




NOMINAL ACCOUNT:

 accounts relating to income, revenue, gain, losses and expenses are termed as nominal accounts. These accounts are also known as fictitious accounts as they do not represented any tangible asset. A separate account is maintained for each head or expense or loss and gain or income.




The rules for the nominal accounts is: 

Credit all income and gains.

Debit all expenses and losses




Wages account,

 rent account,

 commission account,

 interest received account are some example of nominal account.