GOLDEN RULES OF ACCOUNTING

There are three golden rules of accounting on which whole accounting is based. There are three types of accounts and all of them have their respective rules for posting.

1. REAL ACCOUNT: This account is related to assets .
Its rule is Debit what comes in
Credit what goes out.

2. NOMINAL ACCOUNT: It is related to various expenses, incomes, losses and gains. Its rule is
Debit all expenses and losses
Credit all incomes and gains

3. PERSONAL ACCOUNT: It is related to persons or body of individuals or association of persons. Its rule is
Debit the Receiver
Credit the Giver

These are essential rules of accounting.

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2 thoughts on “GOLDEN RULES OF ACCOUNTING

  1. Control on the Emotion plays important role the stock Market

    Stock market is the most volatile martket where the pulse rate is econd that is prices of stock changes after every three second. Hence the investors have to be very caustious, judicious, keen, while taking investment decisions. Moreover, he/she has to have control his/her emotion as the market is lead by rumours a person has to decide the perfect time to buy and sell the securities other wise he/she may be misleaded by the market. Hence as a prudent investor he has to consider the following aspects:

    1. Proper market survery
    2. Propert timeing of investment and disposing the existing investment
    3.Control on emotions
    4. Proper homework on security analysis and portfolio management
    5.Keen observation the market.
    6. keen observation on the economic variables and its impact on the market
    7.Follow the guidlines of SEBI, NSDL, IIFL etc.,

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