Tally ERP 9 Accounting Rules & Basics Of Accounting 2021

1.1 Introduction

Accounting is a process of identifying, recording, summering and reporting economic information to decision makers in the form of financial statements. Financial statements will be useful to the following parties: Basics Of Accounting

• Suppliers

• Customers

• Employees

• Banks

• Suppliers of equipment,  buildings and other assets 

• Lenders 

• Owners                                                                                                                                                                                                                                                         

1.1.1 Types of Accounts  

   

There are basically three  of  Accounts maintained for transaction :

• Real Accounts 

• Personal Accounts 

• Nominal Accounts  

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Real accounts are accounts relating to properties and assets, which are owned by the business concern. Real accounts include tangible and intangible accounts. For example. Basics Of Accounting 

• Land a Building 
• Goodwill 
• Purchases 
• Cash

Personal Accounts 

Personal Accounts are Accounts which relate to persons. Personal Accounts include the follow ing. Basics Of Accounting

• Suppliers 

• Customers 

• Lenders 

Nominal Accounts are Accounts which relate to incomes and expenses and gains and losses o business concern. For example 

• Salary Account 

• Dividend Account 

• Sales 

Accounts can be broadly classified under he following four groups. 

• Assets 

• Liabilities 

• Income 

• Expenses 

The above classification is the basis for generating various financial statements viz., Balance Sheet, Profit & Loss A/c and other MIS reports. The Assets and liabilities are taken to Balance sheet and the Income and Expenses accounts are posted to Profit and Loss Account. Basics Of Accounting

1.1.2 Golden Rules of Accounting

                   Real Accounts      Personal Accounts   Nominal Accounts

Debit          What comes in           The Receiver                   Expenses and Losses

Credit         What Goes                 The Giver                        Incomes  and Gains