The chart of accounts is a list of accounts that will be used by your business accounting system when entering transactions into the general ledger. The accounts are descriptive based on their account types; assets, liabilities, equity, revenue, and expenses. The account titles include an account number that will correlate to the account type.
A chart of accounts is a working list and can take many shapes and forms. A standard setup may include:
1000’s - Assets
2000’s - Liabilities
3000’s - Equity
4000’s - Revenues
5000’s - Cost of Goods Sold
6000’s - Operating Expenses
7000’s - Other Items
8000’s - Taxes
Depending on the nature of your business, whether or not you have departments or sub-categories, it is important to have a structured chart of accounts that promotes accurate transaction postings.
For more information on accounts types, please see the article “What are account types?”
Need help selecting a template that's right for your business? See the article “What templates are available?”