In traditional accounting classification what is another name for a real account and is it permanent or temporary and what is another name for a nominal account and is it permanent or temporary?

Introduction / Context:
Accounting divides ledger accounts into real accounts nominal accounts and personal accounts. This question checks whether you understand the nature of real and nominal accounts and their other commonly used names. It also tests whether you know which type is considered permanent and which type is temporary. These basic concepts are frequently asked in interviews and objective tests because they directly affect how closing entries and financial statements are prepared at the end of the accounting year.

Given Data / Assumptions:

• Real accounts represent assets and liabilities that appear in the balance sheet.
• Nominal accounts represent incomes and expenses that appear in the profit and loss account.
• Permanent accounts are carried forward from one accounting period to the next without being closed to capital.
• Temporary accounts are closed at the end of each period and their balances are transferred to capital or retained earnings.

Concept / Approach:
Real accounts are often called balance sheet accounts because their closing balances appear in the balance sheet. They are permanent accounts since their balances are carried forward into the next accounting period. Examples include building machinery stock debtors and creditors. Nominal accounts are often called profit and loss accounts because they relate to incomes and expenses that appear in the profit and loss statement. They are temporary accounts because at the end of the period their balances are closed and transferred to the capital or retained earnings account so that the new period starts with zero balances for income and expense items.

Step-by-Step Solution:
Step 1: Recall that real accounts record assets and liabilities which continue beyond one year so they are permanent.Step 2: Recognise that balances of such accounts appear in the balance sheet therefore real accounts can be called balance sheet accounts.Step 3: Recall that nominal accounts record incomes and expenses for a particular period.Step 4: At year end the balances of nominal accounts are transferred to the profit and loss account and then to capital so they are temporary accounts.Step 5: Compare these facts with the options and select the one that states real equals balance sheet equals permanent and nominal equals profit and loss equals temporary.

Verification / Alternative check:
An easy way to verify is to think about what happens during closing entries. At the end of the year you close sales purchases rent interest and similar accounts to the profit and loss account. These are nominal accounts and they do not carry forward with balances into the next year. In contrast assets such as building or equipment and liabilities such as long term loans retain their balances and appear again in the new period. This confirms that real accounts are permanent balance sheet accounts and nominal accounts are temporary profit and loss accounts.

Why Other Options Are Wrong:
Option B reverses the relationship by calling real accounts temporary and nominal accounts permanent which contradicts standard accounting theory. Option C claims that both real and nominal accounts are temporary which would mean assets and liabilities are closed each year which is not correct. Option D claims that both are permanent which would prevent the closing of income and expense accounts and make it impossible to calculate profit for each period. Therefore only option A correctly matches the accepted definitions.

Common Pitfalls:
Students sometimes mix up nominal and real accounts and think that because profit and loss is a final statement it must be permanent. Another pitfall is to assume that any account that is not a personal account is automatically permanent. To avoid confusion always link real accounts with the balance sheet and ongoing balances and nominal accounts with the profit and loss account and period specific performance. This clarity is essential for journalising closing entries and understanding financial statements.

Final Answer:
A real account is also called a balance sheet account and is permanent while a nominal account is also called a profit and loss account and is temporary.