Question

Debit - all expenses and losses

Credit - all gains and income is the rule for_______________.

• A. Real account
• B. Personal account
• C. Nominal account
• D. None of these

Answer 1

The correct option is C Nominal account

There are mainly three types of accounts: Real, Personal and Nominal accounts.

Accounts which are related to expense, losses, incomes or gains are called Nominal accounts. E.g. Purchase A/c, Salary A/c, Sales A/c, Commission Received A/c.

The golden rule for nominal accounts is:

Debit all expenses and losses;

Credit all incomes and gains.