Question 22 of 31
Q.Give the golden rules of Double Entry accounting system.
Puducherry TnboardTamil Nadu HSC First Year (DGE) Commerce Board 2024Subjective· 2mImportance★★★★★
71% · 22/31 Questions
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Start your 14-day free trial to unlock the full solution →The golden rules of the double-entry system are the debit/credit rules for personal, real and nominal accounts.
Under the traditional (British) approach of the double entry system, every transaction is recorded using three golden rules, one for each class of account:
| Type of account | Golden rule |
|---|---|
| Personal account (persons, firms) | Debit the receiver, Credit the giver |
| Real account (assets, properties) | Debit what comes in, Credit what goes out |
| Nominal account (expenses, losses, incomes, gains) | Debit all expenses and losses, Credit all incomes and gains |
| … |
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