What is a real account?
Understand the Problem
The question is asking for information regarding what a real account is, which is a concept in accounting and finance. A real account is a type of account in the accounting system that represents assets and liabilities that exist physically, as opposed to nominal accounts which represent temporary accounts such as revenue or expense accounts.
Answer
A real account is a permanent general ledger account that does not close at the end of an accounting period.
A real account, or permanent account, is a type of general ledger account that does not close at the end of an accounting period. Examples include accounts in the balance sheet like assets, liabilities, and stockholders' equity.
Answer for screen readers
A real account, or permanent account, is a type of general ledger account that does not close at the end of an accounting period. Examples include accounts in the balance sheet like assets, liabilities, and stockholders' equity.
More Information
Real accounts are foundational for tracking the financial stability of a business over multiple periods.
Tips
Ensure to differentiate between real accounts (assets, liabilities, equity) and nominal accounts (revenues, expenses) which do close at the end of the period.
Sources
- What Are Real Accounts? | Overview, Types, & Examples - patriotsoftware.com
- Real account definition - AccountingTools - accountingtools.com
- Real Accounts Used in Accounting - Muzamil Aziz - muzamilaziz.medium.com
AI-generated content may contain errors. Please verify critical information
