BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -Capital account is the account of a natural person, i.e. an account of person who is alive. Hence, it can be classified as a personal account.

Detailed explanation-2: -A capital account is used in accounting to record individual ownership rights of the owners of a company. The capital account is recorded on the balance sheet and is composed of the following items: Owner’s capital contributions made when creating the company or following the creation, as required by the business.

Detailed explanation-3: -Nominal Accounts are accounts related to and associated with losses, expenses, income, or gains. Examples include a purchase account, sales account, salary A/C, commission A/C, etc. The outcome of a nominal account is either profit or loss, which is then ultimately transferred to the capital account.

Detailed explanation-4: -Also, capital belongs to the personal account. Therefore, applying the golden rules, you have to debit what comes in and credit the giver. Rent is considered as an expense and thus falls under the nominal account. Additionally, cash falls under the real account.

Detailed explanation-5: -Ledger accounts that contain transactions related to individuals or other organizations with whom your business has direct transactions are known as personal accounts. Some examples of personal accounts are customers, vendors, salary accounts of employees, drawings and capital accounts of owners, etc.