The concept of Account and the double entry rule.

Yvonne Chioma Ofodile Written by Yvonne Chioma Ofodile · 43 sec read >

Note that the page of every ledger is divided into two, and on every page is an account. Every debit entry must have a corresponding credit entry and vice versa. The left-hand side of an account is debit while the right hand is the credit with the heading as the title of the T account.

As a business leader, Corporate Financial Accounting has helped me to understand the ledgers recording transactions carried out in my organization. We have three main classes of Accounts which are :
1) Personal Account: Accounts kept for persons, debtors, or creditors. Here you debit the receiver and you credit the giver.

2) Real Accounts: Accounts for tangible properties. Things that can be seen and touched e.g Cash, Cars, Houses, etc. Here you debit what comes in and credit what goes out.

3) Norminal Account: This is usually income and expenditure items. Here you debit all expenses and losses and credit incomes and gains.

As a business executive, leading the Tree accounting system, especially for the retail arm of my business has helped me allocate items properly even before the accountants send in their reports I already understand how well the business is growing or not in the last two months.


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