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Basic Principles of Accounting

Golden Rules of Accounting

Sl. No. Name of Account Debit Aspect Credit Aspect
1 Personal Account The Receiver The Giver
2 Real Account What Comes In What Goes Out
3 Nominal Account All Expenses All Incomes

If there is an increase or decrease in one account, there will be equal decrease or increase in another account. Accordingly, the following rules of debit and credit in respect of the various categories of accounts can be obtained.

The Golden rules may be summarised as below

Name of Account Debit Aspect Credit Aspect
Assets Increase Decrease
Liabilities Decrease Increase
Income Decrease Increase
Expenses Increase Decrease
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