QB chart of accounts

QB allows to edit the flexible chart of accounts. Does not matter which company chart of accounts was used to create the company.

Keyboard shortcut Ctrl/ A or Menu Accountant –> Chart of Accounts, or HOME page choose the chart of accounts.

The chart of accounts follows the A = L + E formula.

Chart of accounts should have account numbers; however if there are subaccounts, I find that it is best to leave the chart numbers out of the subaccounts and place them alphabetically under the master account number:

Ex.

8522 Chevrolet IXPN truck expenses
       gas
       parking
       registration
       tolls

Instead of:

8522 Chevrolet IXPN truck expenses
     8522.01 gas
     8522.05 parking
     8522.11 registration
     8522.15 tolls

Too many numbers.

Try to keep the chart of accounts as simple as possible and be sure to follow accrual accounting procedures for prepaid insurance, and any prepayments that may be depleted month to month.

Why: because if one posts the full amount of an insurance payment for, lets say six months of June, the month of June will have an unusual expense spike for expenses that have yet incurred; therefore apply the appropriate accounting rules for prepayments.

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