Chart of Accounts Numbering in Accounting Software
A chart of accounts is a listing of accounting general ledger accounts that are utilized in a accounting system to record transactions. There are universal numbers used to start your general ledger codes and to make your life easier, its best to set up your chart of accounts with these universal bookkeeping practices in mind.
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CHART OF ACCOUNTS NUMBERING
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-- Balance Sheet General Ledger Accounts --
1 accounts = Assets (order of liquidity)
Cash
Accounts Receivable
Prepaid Expenses
Investments
2 accounts = Liabilities (current to noncurrent)
Accounts Payable
Accrued Expenses
Bank Debt
3 accounts = Equity
Par Value Stock
Additional Paid-in
Retained Earnings
For more information on a balance sheet watch:
• Financial Statements: Balance Sheet Explai...
-- Income Statement General Ledger Accounts --
4 accounts = Revenue
Fees
Commission Revenue
Sales
5-7 general ledger accounts = Operating Expenses / Cost of Goods Sold
Cost of Goods Sold
Compensation
Rent
Technology/Software
Consulting
7-9 general ledger accounts = Other Operating Expense / Other Expenses / Other Income
Depreciation / Amortization
Taxes
Interest Expense
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Disclosure Disclaimer: The information in this video is provided for general educational purposes only and may not reflect changes in federal or state laws. Please consult with a professional tax advisor about your facts and circumstances.
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