12th sep 11th cbse accountancy

In the Traditional Approach, which of the following is true for Real Accounts?

• They include both assets and liabilities

• They include only incomes and expenses

• They include only tangible and intangible assets

• They represent gains and losses

Which of the following transactions would involve both a Nominal and a Personal Account?

• Purchase of machinery for cash

• Payment of salary to employees

• Receiving rent from a tenant

• Writing off a bad debt

Answer explanation

(Salary is Nominal, and Employees (as creditors) are Personal)

Which account would be credited in the case of a loan taken from a bank under the Traditional Approach?

• Bank Account (Real Account)

• Loan Account (Personal Account)

• Interest Paid Account (Nominal Account)

• Cash Account (Real Account)

In the Traditional Approach, if an asset is sold at a profit, which accounts are impacted?

• Only Real and Nominal Accounts

• Only Personal and Nominal Accounts

• Only Real and Personal Accounts

• Real, Personal, and Nominal Accounts

Answer explanation

The asset is Real, and the profit is Nominal

The entry “Debit Bad Debts, Credit Debtors” follows which rule of the Traditional Approach?

• Real Account: Debit what comes in, Credit what goes out

• Personal Account: Debit the receiver, Credit the given

• Nominal Account: Debit all expenses, Credit all incomes

• Real Account: Debit the asset, Credit the liability