Question

The rule of personal account states that Debit the receiver and Credit the giver.

• A. True
• B. False

Answer 1

The correct option is A True

Personal accounts are related to individuals, firms, companies, etc. A few examples of personal accounts include debtors, creditors, banks, outstanding/prepaid accounts, accounts of credit customers, accounts of goods suppliers, capital, drawings, etc.

Natural personal accounts are the simplest to understand out of all and includes all God's creations who have ability to deal, who, in most cases, are people. E.g. Kumar's A/c, Adam's A/c, etc.

Artificial personal accounts are created artificially by law, such as corporate bodies and institutions, are called Artificial personal accounts.

Representative personal accounts represent a certain person or group directly or indirectly.

The golden rule for personal accounts: Debit the receiver; Credit the giver.