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    Question

    Which of the following is the golden rule of entry for

    personal accounts in the accounting process?
    A Debit the receiver, credit the giver Correct Answer Incorrect Answer
    B Debit the giver, credit the receiver Correct Answer Incorrect Answer
    C Debit what comes in, credit what goes out Correct Answer Incorrect Answer
    D Debit what goes out, credit what comes in Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    A personal account is a general ledger account pertaining to individuals or organizations. The golden rule of accounting for personal accounts is to debit the receiver and credit the giver:

    • Debit the receiver : When a business receives something, the account is debited.
    • Credit the giver : When a business gives something, the account is credited
      The golden rules of accounting are based on generally accepted accounting principles (GAAP). 

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