Personal Account

What is a Personal Account?

A personal account is an account classification in double entry bookkeeping.

Personal accounts always represent an individual or an organization. Personal accounts are considered permanent because they are not closed at the end of each accounting period. At the start of the new accounting period, the closing balance from the prior accounting period is brought forward and becomes the new opening balance on the account.

An example of a personal account is the bank account. The bank account represents a balance with a particular organization (XYZ Bank) and is therefore considered to be a personal account. This is in contrast to petty cash for example, which represents physical cash within the business and is classified as a real account.

For further information see the Wikipedia Personal Accounts definition.

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Last modified May 30th, 2018 by Team

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