The correct answer is B. Nominal account.
A nominal account is an account that is used to record income and expenses. It is a temporary account that is closed at the end of the accounting period. The balance of a nominal account is transferred to the profit and loss account, which is then used to calculate the net profit or loss for the period.
A real account is an account that is used to record assets, liabilities, and equity. It is a permanent account that is not closed at the end of the accounting period. The balance of a real account is carried forward to the next accounting period.
A personal account is an account that is used to record transactions with individuals or businesses. It is a permanent account that is not closed at the end of the accounting period. The balance of a personal account is carried forward to the next accounting period.
Here is a table that summarizes the key differences between nominal, real, and personal accounts:
| Account type | Purpose | Treatment at the end of the accounting period |
| — | — | — |
| Nominal account | Records income and expenses | Closed at the end of the accounting period and the balance is transferred to the profit and loss account |
| Real account | Records assets, liabilities, and equity | Not closed at the end of the accounting period and the balance is carried forward to the next accounting period |
| Personal account | Records transactions with individuals or businesses | Not closed at the end of the accounting period and the balance is carried forward to the next accounting period |