Chart of Accounts

Chart of Accounts is used to view and edit all existing accounts that you have entered. Accounts are the grouping of assets, liabilities, equity, income and expenses that drive your financial statements.

Only accounts marked Active can be used for the entry of new transactions or entities. If you decide that you no longer need an account you may mark it inactive by un-checking Active.

Bank Accounts require additional setup. The Banking tab is used to setup and define bank account information that must be printed on the MICR line of a check. MICR (Magnetic Ink Character Recognition) is characters used to print information on documents that allows the character to be processed by machines. An address should also be added for Bank Accounts.

The MICR line is generated by concatenating the check number, Routing # and On US Field. Check Number is initialized in the Last Check # field for the bank account.

The Use Account IDs option allows you to setup the system to use a combination of Account ID and Name or Account Names when selecting in Account during transaction entry or entity setup.

While it is not required, financial statements or reports are organized by account type and then account name or account number, if being used. Using account number will give you more flexibility in developing your financial reports.

A suggested account numbering scheme is as follows:

1. 1000s: Assets

2. 2000s: Liabilities

3. 3000s: Equity

4. 4000s: Income

5. 5000s: Cost of Sales

6. 6000s, 7000s: Other operating expenses

7. 8000s: Other income

8. 9000s: Other expenses

Account Types are assigned to accounts as the primary grouping for presentation on your company's financial statements.

Account Type	Balance Sheet / Income Statement Grouping	Current or Long-Term	Shown as Positive if the Balance is:
Bank	Asset	Current	Debit
Accounts Receivable	Asset	Current	Debit
Inventory	Asset	Current	Debit
Other Current Asset	Asset	Current	Debit
Fixed Asset	Asset	Long-Term	Debit
Other Asset	Asset	Long-Term	Debit
Accounts Payable	Liability	Current	Credit
Credit Card	Liability	Current	Credit
Other Current	Liability	Current	Credit
Long Term	Liability	Long-Term	Credit
Equity	Equity		Credit
Income	Gross Profit		Credit
Cost of Goods Sold	Gross Profit		Debit
Expense	Expense		Debit
Other Income	Other Income/Expense		Credit
Other Expense	Other Income/Expense		Debit
Interest Paid	Other Income/Expense		Debit
Income Tax	Taxes		Debit