Question

what could be the treatment of capital and asset according to modern approach of accounting?​

Answer 1

Financial accounts can be classified into two types of approaches. Firstly, according to the Traditional approach or the British approach. The other way is the Modern approach or the American approach.

Traditional approach classifies the accounts while Modern approach uses the Accounting equation for accounting. Further, under the Traditional approach, all the ledger accounts are classified as “Personal” and “Impersonal accounts”. The rules of debit and credit under the Traditional approach are golden rules. Let us now understand them and how the accounts are classified.

Answer 2

Answer:

Financial accounts can be classified into two types of approaches. Firstly, according to the Traditional approach or the British approach. The other way is the Modern approach or the American approach. The Key concepts under the Traditional approach are personal and impersonal accounts which we will discuss further in here.

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