A real account is a general ledger account (GL account) that does not close at the end of the accounting year (as opposed to nominal accounts that do). It is an account that is permanent in nature- i.e., it will always be a part of a entity’s books once created. The account’s balance is carried forward at the end of each accounting period.
Accounts on the balance sheet are real accounts: assets, liabilities and equity. Specifically, real accounts include cash, accounts receivable, accounts payable, supplies, prepaid items (e.g., prepaid insurance), notes payable, equipment, unearned revenue, and retained earnings.
These accounts are permanent in nature, i.e., continue as part of the books of an entity as long as the entity remains in business.
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