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Is Purchases Discount A Nominal Account Real Or A Personal Account? Purchases Discount is not a Real Account as it is not related with assets and liabilities of the business. All of real accounts will go to the balance sheet as these are Permanent Accounts. Purchases Discount is also not a personal account which is related with natural and living persons. Such as a sole owner’s account is named as “Mr. A’s Account” and it is treated as a personal account. Is purchases discount is a nominal account? Yes, it is true as it is a contra expense account like Purchases Returns and Purchases Allowances and it is deducted from Gross Purchases in Income Statement to reduce it as the suppliers’ company gave purchase discount to company for goods purchased. So, we can say that Purchases Discount is a nominal account but not a real and personal account in accounting.

Sales Discount Is Which Kind Of Account? Sales Discount is not a Real Account which is related with assets and liabilities accounts ( Balance Sheet Accounts ) such as Cash, Accounts Payable, etc. Sales discount is also not a personal account as it is not related with natural or living persons. Natural persons are sole owners, partners, shareholders, directors, etc., in a business. Actually, sales discount is a nominal account as it is a Contra Revenue Account which is deducted from Gross Sales on Income Statement. For example, if we have Gross Sales of Rs. 50000 and we give sales discount of Rs. 5000 to our customer, Mr. A, then this Rs. 5000 of sales discount is a nominal account and it is deducted from Total Sales to Calculate Net Sales i.e., 50000 - 5000 = Rs. 45000. So, we can say that sales discount is a nominal account but not a real and personal account. So, this is the answer to the question mentioned above.

Purchases Return Is Which Type Of Account In Accounting? Purchases Return is not a real account as it is not an asset or a liability account which are studied under real accounts. Purchases Return is also not a personal account, like a capital account, drawings account, Mr. A’s account or any other natural or living person account, as it is not related with natural or living persons. Yes, surely, purchases return is a Nominal Account as it is deducted from total purchases on Income Statement or trading account. Since it is a Contra Expense Account , so purchase return is treated as nominal account which includes all revenue and expenses accounts. So, we can say that purchases returns are nominal accounts but these are not treated as real or personal accounts in accounting.

Is Sales Return A Nominal, Real Or A Personal Account? Sales Return is not a Real Account as it is not related with assets and liabilities accounts i.e., these accounts are recorded in balance sheet while sales return account is recorded in Income Statement. Sales return is also not a personal account as it is not related with natural or living persons such as Mr. X Account is a personal account as it belongs to a natural person i.e., a sole owner, let’s say. Yes, it is a nominal account and it is deducted from Gross Sales on Income Statement as it is a Contra Revenue Account . It reduces total sales which is also a nominal account. So, we learn that a sales return is a nominal account as it is a contra revenue account but not a real and personal account in accounting.

Here, we are concerned that “Wages Is Which Type of Account In Accounting”. Wages is not a Real Account as it is not related with assets and liabilities accounts. It is also not related with personal account which is concerned with natural or living persons. Yes, wages expense is a nominal account as it is an expense account which is recorded in Income Statement as it is a temporary account. For example, wages expense account of Rs. 5000 recorded in Income Statement for the accounting period is a nominal account. So, we conclude that wages is a nominal account but not a real or a personal account.

In This Post, We Will Try To Understand The Answer To The Question (MCQ), "Which Book Is Called As Total of Debit And Credit In Accounting"? Trial Balance is called total of debit and credit. As it is prepared to show arithmetical accuracy of Books of Accounts upto an extent. A trial balance contains classified balances of assets, liabilities, equity, revenues and expenses transferred from Ledger’s Accounts of business. The total of debit side in trial balance must be equal to the total of credit side, otherwise, there are errors, mistakes or frauds due to which trial balance is disagreed. However, there are also possibilities that the totals of both debit and credit in trial balance are equal but still there are certain secret types of error, mistakes or frauds which are not shown in a trial balance such as a transaction is completely omitted from the records does not affect neither debit side nor credit side of trial balance and trial balance is agreed.

Is Salaries Expense A Decrease In Equity? Yes, Salaries Expense is a decrease in Equit y under  Accounting Equation as it is an expense account incurred to produce revenue. So, it will decrease the equity. Actually, these expenses are incurred for many purposes such as for the smooth working of business operations conducted by employees during the business hours i.e., a marketing staff manages the complaints of customers, making plans to increase sales, etc. So, these are profitable activities conducted for the purpose of earning revenue for the business and considered as expenses for the business to earn revenue for the period. Is Salaries Expense An Increase In Equity? No, as it is an expense account which decreases owner’s equity or equity account. So, it is incurred to earn revenue to increase equity when the business earns profits or income in future by selling goods or services to customers on profit. So, we can say that Salaries Expense is a decrease in equity bu

In Accounting, What Types Of Account  Salaries Expense   Is? Salaries expense is not a real account as it is not related with assets and liabilities accounts, which are Permanent Accounts , which are finally transferred to balance sheet. Salaries expense is also not a personal account as it has no concern with living or natural persons such as Mr. A’s account which is related with living person but it is not related with nominal accounts i.e., revenue & expense accounts. Yes, Salaries expense is a Nominal Account as it is an expense account recorded in Income Statement. Salaries expense account is a temporary account as it is closed at the end of accounting period. Also it is not a permanent account as it does not have any balance left at the end of the accounting period.

Is Trial Balance Merely A Proof of Arithmetical Accuracy Or A Conclusive Proof of Accuracy of Books of Accounts? Yes, Trial Balance is merely a proof of arithmetical accuracy as it shows that the total of debit account balances are equal to the total of credit accounts balance arithmetically. As it reveals only some sorts of errors, mistakes or frauds which are causing disagreement of trial balance but fails to show hidden and secret types of errors, mistakes and frauds which are causing agreement of trial balance, so it is not a conclusive proof of accuracy of Books of Accounts . This is the main limitation of trial balance. Note: Here Arithmetical Accuracy means mathematically correction or correction in quantity measurement i.e., the value wise or quantity wise correction. Eventhough, the total of debit accounts is equal to the total of credit accounts arithmetically but still there are certain types of errors, mistakes or frauds which are not disclosed or revealed in trial b

Closing Journal Entry For Salary Expense Account In Accounting? Salary Expense is a Temporary Account and closed to Income Summary Account at the end of the accounting period. The closing entry to record salary expense is shown below:                                             Income Summary a/c  XXX                                                                                Salary Expense a/c  XXX                                  (Salary Expense a/c closed to Income Summary Account) As salary expense account’s balance is debit, so to close it, we credit it and debit income summary account in order to transfer salary expense account to income summary account. As salary expense account is closed, so it is also treated as an Income Statement Account and recorded in Income Statement .

Closing Entry of Sales Revenue Account To Income Summary Account During the closing process, the closing entry to reduce the Sales Revenue Account is recorded by a debit to sales revenue account and a credit to Income Summary Account . The entry to record is shown below:                                                              Sales a/c  XXX                                                                                  Income Summary a/c  XXX                                                  (Sales a/c is closed to Income Summary a/c)   As the favorable balance of sales account is credit, so to close it we debit it in order to transfer it to income summary account. Sales account is a temporary account so it has no balance at the end of the accounting period. So, to close sales revenue account, we need to debit it and we can do so by transferring it to income summary account.

The Type of Account And Normal Balance of Unearned Consulting Fees Would Be What? Unearned Consulting Fees or Consulting Fees Received in Advance is not a Nominal Account as it is not a revenue account which is related with nominal accounts. Unearned consulting fees is not a personal account as it is also not related with natural or living persons. Such as Mr. A’s Account which is related with the sole owner and considered as a natural or living person’s account but unearned consulting fees account is not related with personal account. Yes, unearned consulting fees is a real account as it is related with Current Liabilities which are concerned with real accounts. The normal, positive, usual or favorable balance of unearned consulting fees is credit. However, when it increases, we credit it and when it decreases, we debit it according to the Rules of Debit and Credit . So, negative, unusual or unfavorable balance of unearned consulting fees is debit. So, the type of acc