Account Types in Accounting

An Account in book keeping terms signifies a collection of similar transactions so as to enable correct and logical reporting. So if during the year there are 12 transactions relating to property rent, they will be clubbed together in an ACCOUNT named as RENT. This will make possible giving a single view of all the rent and related transactions.

Accounts are usually of following type:

1. Personal Account
2. Impersonal Account

Impersonal Account are next further bifurcated into:
a. Real Account
b. Nominal Account

So if we look at the entire picture, the ACCOUNT tree will look something like this

ACCOUNT
1. Personal Account
2. Impersonal Account
a. Real Account
b. Nominal Account

Personal Account: As the name suggest, personal account usually deals with accounts created for people, organanizations, establishments, governments and so on

Impersonal Account: All accounts other than Personal Accounts will be Impersonal Account.


Real Account: Real Account deals with accounts which have a tangible existence but cannot be classified under Personal Account. Usually Assets and Liabilities are classified as Real Account.

Nominal Account: Accounts created to deal with Expenses/Losses or Income/Gains are classified under Nominal Account