hi experts can you pls explain the basic rule of accountancy
Dear Student, as per the Double Entry System of accounting, every transaction has two effects or dual aspect i.e. Debit and Credit. Every debit has its correspondence credit and vice versa. Every debit and credit implies increase or decrease in an account as per the nature of the accounts i.e. Personal, Real and Nominal.
Moreover, the rule of an account as per the nature of the account are termed as three basic or golden rule of accounting, which are as follows.
As per the Personal Account - 'Debit the receiver, Credit the giver'.
As per the Real Account - 'Debit what comes in, Credit what goes out'.
As per the Nominal Account - 'Debit all the expenses and losses, Credit all the incomes and gains'.
I hope this answers your query.
Keep Posting!!
Moreover, the rule of an account as per the nature of the account are termed as three basic or golden rule of accounting, which are as follows.
As per the Personal Account - 'Debit the receiver, Credit the giver'.
As per the Real Account - 'Debit what comes in, Credit what goes out'.
As per the Nominal Account - 'Debit all the expenses and losses, Credit all the incomes and gains'.
I hope this answers your query.
Keep Posting!!