Friday, November 3, 2023

A/C Rule

 

Example of the Golden Rules of Accounting

In the below example, we have listed different type of transactions along with the type of accounts and details of debit/credit after applying the accounting rules.

Sl No.

Accounting Transaction

Accounts Involved

Type of account

Debit/ Credit

1.

Mr Sham started a business with Rs.60,000 cash.

Cash A/c
Capital A/c

Real
Personal

Debit what comes in
Credit the giver

2.


Purchased goods for cash 25,000 Tk

Purchase A/c
Cash A/c
Real
Real

Debit what comes in
Credit what goes out

3.

Sold goods for cash 20,000 Indo Rupiah

Cash A/c
Sales A/c ( Inventory sold )

Real
Real

Debit what comes in
Credit what goes out

4.

Purchased goods from Mr Bhasha for cash 10,000 dirham

Purchase A/c (Inventory Purchased)
Cash A/c

Real
Real

Debit what comes in
Credit what goes out

5.

Sold goods to Mr Sam  8,000 KES on credit.

Mr Sam  A/c
Sales A/c ( Inventory sold )

Personal
Real

Debit the receiver
Credit what goes out

6.

Purchased furniture for Rs.6,000

Furniture A/c
Cash A/c

Real
Real

Debit what comes in
Credit what goes out

7.

Paid rent 1,500 Tk

Rent A/c
Cash A/c

Nominal
Real

Debit expenses
Credit what goes out

8.

Paid wages 10,000 Indo rupiah from Bank

Wages A/c
Bank A/c

Nominal
Real

Debit expenses
Credit what goes out

9.

Purchased goods from Ali Ltd on credit

Purchase A/c ( Inventory purchased )
Ali Ltd

Real
Personal

Debit what comes in
Credit the giver

10.

Dividend received in cash

Cash A/c
Dividend

Real
Nominal

Debit what comes in
Credit income

11.

Salary outstanding

Salary A/c
Salary Outstanding A/c

Nominal
Representative
personal

Debit expenses
Credit the representative personal account