Types Of Accounts

Princy Vij
40 mins
a:3:{i:0;s:14:"Self-awareness";i:1;s:17:"Critical thinking";i:2;s:15:"Decision making";}
a:3:{i:0;s:8:"Remember";i:1;s:10:"Understand";i:2;s:10:"Creativity";}

Types Of Accounts
To help students differentiate between various types of accounts which are the base for further accounting clarity
In - depth Clarity on the basic types of accounts

Types of Accounts

Step 1: Begin the class by choosing three volunteers in the class.

Step 2: Name the first volunteer “Names”

Step 3: Name the second volunteer “Tangible”: this includes things around you that you can see

Step 4: Name the third volunteer “Intangible”: this will include things that we cannot see.

Step 5: Ask the remaining seated students to each make a chit writing any of the objects that fall in the above three categories: foreg: Ram, Mohan, Salary, Loss, rent, Chair, School Fees, Table etc.

Step 6: You (Teacher) read out the chits one by one and ask the students to stand up who wrote the chit and stand with the category it belongs to.

Step 7: You will get a fair segregation of three categories.

These three categories are nothing but the three types of accounts as follows:

  1. “Names Category” or Personal Account: The elements or accounts which represent persons and organisations.
  • Mrs. Vimla a/c – representing Mrs. Vimla a person.
  • M/s Bharat & Co a/c – representing M/s Bharat & Co, an organisation.
  • Capital a/c – representing the owner of the business, a person or organisation.
  • Bank a/c – representing Bank, an organisation.

2. “Tangibles” or Real Accounts

The elements or accounts which represent tangible aspects.

  • Cash a/c – representing cash which is tangible.
  • Goods/Stock a/c – representing Stock which is tangible.
  • Furniture a/c – representing Furniture which is tangible.
  1. “Intangible Category” or Nominal Accounts

The elements or accounts which represent expenses, losses, incomes, gains.

  • Salaries a/c – representing expenditure on account of salaries, an expense.
  • Interest received a/c – representing income on account of interest, an income.
  • Loss on sale of Asset a/c – representing the loss incurred on sale of assets, a loss.

 

Give atleast 50 objects pertaining to the three categories we just discussed. Ask the students to segregate it in the three categories of accounts.
Ram Started business with Rs. 50,000. He withdrew Rs. 2000 for his personal use. Will his withdrawal be counted as his personal drawing or a loss to the business?
Accurate, Knowledgeable, Organized, Persuasive