Accounting for Beginners

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1.2 Types of Accounts in Accounting

By Aditya Gupta · Accounting for Beginners Course

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The Three Types of Accounts

In accounting, every transaction involves at least two accounts. Understanding the three types of accounts is the foundation for applying the Golden Rules of Accounting (covered in the next topic).

Type What It Represents Examples (Indian Context)
Personal Account Accounts related to persons, firms, or organisations Ramesh’s Capital A/c, HDFC Bank A/c, Vendor Sharma & Co., GST Payable A/c
Real Account Accounts related to tangible and intangible assets Cash A/c, Building A/c, Machinery A/c, Goodwill A/c, Patent A/c
Nominal Account Accounts related to income, expenses, gains, and losses Sales A/c, Rent Expense A/c, Salary A/c, Commission Received A/c
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