How to Classify Accounts in Double Entry System

here is a big question that how to classify accounts in accounting as per the traditional approach in double entry system in accounts that there are three types of accounts, namely, Personal accounts, Real Account and Nominal Accounts which are opened to keep a complete record of all the financial transactions of the business.

Classification of Accounts 

• Natural Person’s Personal Account: An account recording transactions with an individual human being is known as a natural person’s Personal Account, for example, Ram’s Account
• Artificial Person’s Personal Account: An account recording financial transactions with an artificial person created by law or otherwise is called an Artificial Person’s Personal Account, Like Ram Kumar and Sons. Or Suresh Kumar and Co. 
• Representative Personal Account: An account indirectly representing a person or persons is known as a representative personal account. When accounts are of a similar nature and their number is large, it is better to group them under one head and open a representative personal account. For example, such types of accounts can be salaries account Outstanding Accounts, etc.
• Tangible Real Account: such types of accounts relates to an asset which can be touched, felt, seen, and measured e.g. Machinery Account, Cash Account Stock Account, etc.
• Intangible Real Account: Such type of account related to an asset which cannot be, touched physically but can be measured in value. For example Goodwill Account, Trademarks Accounts, etc. 

Few more examples to clarify the types of accounts: 

Drawing Account = Personal Account

Cash Account = Real Account 

Discount Account = Nominal Account 

Salaries Account = Nominal Account 

Bad Debts Account = Nominal Account 

[Also Like: What is Double Entry System in Accounts ]