Classification of Accounts And Their Types

Classification of Accounts:
This is extremely old system for classifying accounts and is not utilized as a part of a large portion of the propelled nations. Under this system, records are classified into four types.
These are:
Individual accounts
Real Accounts                       
Nominal Accounts
Valuation accounts 
These four sorts of records are quickly clarified beneath:
Individual Records: 
These accounts demonstrate the transaction with the clients, suppliers, cash moneylenders, the bank and the proprietor. A business may have numerous acknowledge transaction for the above persons or associations. A different record is to be arranged for each of them. Persons or associations with whom the business has credit exchanges are either indebted individuals or banks. On the off chance that they need to give some cash to the firm, they are called debtors. Alternately, if the firm is to pay them some cash they are known as Creditors. The fundamental motivation behind get ready individual records is to find out the debt remainders to or due from persons or associations.
Genuine/Real Accounts: 
These records are accounts of benefits and properties, for example, area, building, plant, apparatus, patent, money, venture, stock, and so forth. At the point when an apparatus is acquired for money, the two records included are hardware and money - both are genuine records. Be that as it may, if the same machine is acquired from A & Co. using a loan, the two records included will be those of hardware and A & Co., the previous being a genuine record and the later being an Personal Account.
Nominal Accounts: 
These are the accounts of livelihoods, costs, additions and misfortunes. Cases of ostensible records are wages paid, markdown permitted or got, buys, deals, and so forth. These records for the most part aggregate the information needed for the planning of salary explanation or trading and profit and loss account.
Valuation Accounts: 
These are the accounts of procurement for depreciation and procurement for doubt debts. Where altered resources are kept up in the books of records at unique expense, to mirror the genuine book estimation of the benefits, a procurement for deterioration account on the credit is kept up. To be determined sheet, it is indicated as conclusion from the first cost of the advantage. Essentially, if the indebted individuals' close to home records are held at aggregate sum due, a valuation account on the credit - procurement for dicey obligations is needed. In a critical position sheet, it is indicated as a diminished from sundry indebted individuals record to reflect assessed feasible worth.
Example: 
Order the accompanying into genuine, ostensible, individual and valuation accounts:
Plant and apparatus
Buys
Venture
Bank
Procurement for terrible and far fetched obligation
Tata Iron & steel Co.
Rent
Land and Building
Carriage outward
Capital
Leasehold
Trademark
Return outwards
Import obligation
Procurement for devaluation
Solution: 
Genuine/Real record
Ostensible/Nominal record
Genuine/Real record
Individual/Personal record
Valuation account
Individual/Personal record
Ostensible/Nominal record
Genuine/Real record
Ostensible/Nominal record
Individual/Personal record
Genuine/Real record
Genuine/Real record
Ostensible/Nominal record
Ostensible/Nominal record
Valuation account