Accountancy aims at recording every kind of financial transaction in such a way that there is an equal consideration being passed on from Mr. Debit and Mr. Credit to each other. Therefore, the basic structure of accountancy is such that Debit should equal to Credit.
In such a scenario, it was found that we should classify accounts into 3 primary types viz. Personal, Real and Nominal.
Personal Account: It refers to a person or institution capable of entering into a financial transaction. For example, Shah Rukh, Salman, Bank of Baroda, All India Bakchod, Kanan Gill.
Such a person/institution will either give something or take something in a financial transaction. The person who receives is Mr. Debit and the one who gives is Mr. Credit. Hence, Debit the Receiver; Credit the Giver.
Real Account: It refers to a thing which can be given or taken. For example, Shah Rukh may give a "hit movie" and Salman may not give "a shit". Here, both "hit movie" and "shit" become what we refer to as real accounts. To put it more in the perspective of accountancy, things like "cash" and "stock" are real accounts i.e. capable of being given or taken. Thus, you Debit what comes in; Credit what goes out.
Nominal Account: This refers to items of income or expense. For example, your earning from a game of Flash at a Diwali cards' party is an income and will be called "Credit", whereas your loss of money at such a game of cards will be called "Debit". Similarly, things like "interest", "commission" when earned are incomes and are Credit. On the other hand, expenses like "rent", "salaries", "festival expenses" are Debit. Thus, Debit all Expenses and Losses; Credit all Incomes and Gains.
However, it gets tricky in case a nominal account is recorded not in terms of an expense or income, but in context of it having become payable or accrued or receivable i.e. as an asset or liability. In such a case, it turns into a Personal Account. To explain this with an example: "Interest" is a Nominal Account, whereas "Interest Payable" or "Interest Receivable" is a Personal Account. The reason is that when you record only the income or expense, it is a simple Nominal Account; but when you record the fact of it having become a liability due for payment or an asset due to be received, then it becomes a Personal Account because it is receivable from or payable to a person.
To illustrate:
To record interest expense paid in cash, we write:
Interest ... Debit Rs. 100
To Cash Rs. 100
This means, interest (debit all expenses) has been paid in cash (credit what goes out).
But when you want to record an accrued income or expense, say interest payable as on a date without actually paying it because the due date for payment will be sometime later (in the next accounting period), you pass the entry:
Interest ...Debit Rs. 100
To Interest Payable Rs. 100
Here, interest is debited because (debit all expenses) and the liability in the form of "Interest Payable" is credited... because when the interest will actually be paid, "Interest Payable Account" will become the receiver (Debit the Receiver) of interest actually paid in cash. The entry will be as follows.
Interest Payable ...Debit Rs. 100
To Cash Rs. 100
Hope this provides some clarity.