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The chart of accounts is divided into the five
main account categories. They
are assets, liabilities, equity, income and expense accounts. You can
also review all accounts by selecting the all tab.
1. Asset Accounts - things of value owned by the business.
2. Liability Accounts - amounts owed to outsiders.
3. Owner's Equity Accounts - amounts owed by the
business to its owners (profit). If the
business loses money the owners may owe
additional money to the business.
4. Revenue Accounts - Sources of income.
5. Expense Accounts - Payments necessary to run the business.
To
add an account select the icon on the plus icon on the tool bar found
on the top of the screen. A
general ledger account is a combination of the account number and the
department. You can use the same account number for a different account
if you have a different department for each account. The power is in essence the ability to have accounts
departmentalized. For
instance you can have an account called Sales numbered 5000 with
department 10 for Retail and another sales account number 5000 but
with department called 20. Review
the following examples to explain best.
Account
Name
Department
5000
Sales Retail
10 (retail)
5000
Sales Services
20(Services)
6010
Cost of Goods Sold –Retail
10 (retail)
6010
Cost of Goods Sold – Service
20 (service)
This ability is great because it allows you the
capability to perform department and consolidated reporting for
financial reports.
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