Back to the Basics: Quickbooks Edition

Back to the Basics: Quickbooks Edition

Chart of Accounts

The Chart of Accounts is the entire list of a business’ accounts and their balances. This keeps tab how much money your company has, owes, and what’s coming in and out. The more accurate the information is, the more useful the reports will be, therefore watch out for errors and try to be consistent as possible when assigning accounts to transactions.

Balance Sheet

All the information listed below is an accurate representation of what is listed in a balance sheet. The Balance Sheet is useful for giving a summary of your business at a certain period in time. It displays what you own (assets), what you owe (liabilities), and what you have left over (equity) at a certain point in time.

Use this type of account in your Chart of Accounts
To Track
Checking, savings, and money market accounts. Use on bank account for every account your company has at a bank or other financial institution.
Accounts Receivable (A/R)
Transactions related to the customers that owe you money, including invoices, payments, deposits and refunds.
Other Current Assets
Assets that are likely to be converted to cash or used up within one year, such as prepaid expenses and security deposits.
Fixed Asset
Depreciable assets that are likely to be converted to cash or used up within one year, such as prepaid expenses and security deposits.
Other Assets
Any asset that is neither a current asset nor a fixed asset, such as long-term loans you’ve lent out
Accounts Payable (A/P)
Transactions related to money you owe, including bills, payments, and credits.
Credit Card
Credit card purchases, bills, and payments.
Current Liability
Liabilities that are scheduled to be paid within one year, such as sales tax, payroll taxes, and short-term loans.
Long- Term Liability
Liabilities such as loans or mortgages scheduled to be paid over a periods longer than one year.
Owner’s equity, including capital investment and draws.

As always, if you have any questions regarding bookkeeping, accounting, payroll, etc. feel free to call us using the number below!

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From the makers of Quickbooks in collaboration with Real World Training


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