Classification of Account.

All accounts may be grouped in two broad categories or classifications. These are personal and impersonal.

Personal Accounts: These are the accounts that have the names of debtors (customers) or creditors (suppliers). They are therefore personal to this extent.
Impersonal Accounts: These non-personal accounts may be divided into Real Accounts and Nominal Accounts.

• Real Accounts - These accounts are tangible in nature and represent accounts that records possession such as machinery, furniture, premises and stock.
• Nominal Accounts – These accounts are intangible in nature and represent accounts that in which expenses, revenues and capital are recorded.