Joomla TemplatesBest Web HostingBest Joomla Hosting
Home Chart of Accounts

Articles

Chart of Accounts

Chart of accounts is a list of all ledger accounts used by a business organization. These accounts are given identification numbers and appear in the order in which they appear on the financial statements, profit and loss account, and balance sheet. They are arranged in categories as follow: balance sheet accounts: Assets, Liabilities, Capital or Owner’s Equity, and income statement accounts: Revenue and Gains, and Expenses and Losses.

To show accounts on your financial statements, you have to come up with an organized way of presenting your information. Your chart of accounts forms the basis upon which your financial statements are constructed.   You use a numbering system in your chart of accounts to organize your accounts in numerical sequence which is very useful for identification and reference purposes.

For example, the abovementioned categories could be given reference numbers as follow:

Balance Sheet Accounts:
100 Assets accounts
200 Liability accounts
300 Capital or Owner’s Equity

Income Statement Accounts:
400 Operating revenues
500 Non-operating revenues
600 Operating expenses
700 Non-operating expenses and losses

Each account under each of the above categories is assigned a number with gaps between the accounts to allow future addition of new accounts as shown below:

    100 Assets accounts

    • 110 Fixed assets
      • 111 Land
      • 112 Building
      • 113 Fixtures and Fittings
      • 114 Plant and Machinery
      • 115 Motor Vehicle

    • 120 Current assets
      • 121 Stock
      • 131 Debtors
      • 141 Prepayments
      • 151 Accrued Revenues
      • 161 Bank
      • 171 Cash


    200 Liabilities

    • 210 Current Liabilities
      • 211 Trade Creditors
      • 212 Accounts Payable
      • 213 Accrued Expenses
      • 214 Unearned Revenues
    • 220 Long-term Liabilities
      • 221 Bank loan
      • 222 Mortgage Loan Payable


    300 Capital or Owner’s Equity

    • 301 Capital
    • 302 Retained Earnings


      400 Operating Revenues

      • 401 Sales
      • 402 Sales Returns
      • 403 Sales Discounts


      500 Non-operating Revenues

      • 501 Interest Income
      • 502 Rent Receivable


      600 Operating Expenses

      • 610 Selling Expenses
        • 611 Sales Commissions
        • 612 Travel
        • 613 Distribution Expenses
        • 614 Marketing Expenses               
      • 620 Administrative Expenses
        • 621 Salaries
        • 622 Lighting and Heating
        • 623 Telephone expense
        • 624 Postage             
      • 630 General Expenses
        • 631 Repairs and maintenance
      • 640 Financial Expenses
        • 641 Loan Interest
        • 642 Income Tax
        • 643 Rental charges (Property)


      700 Non-operating expenses and losses

      • 701 Interest Charges
      • 702 Employees’ Benefits
      • 703 Pension Contributions

      Last Updated (Monday, 08 November 2010 13:16)