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The structure of accounting
Full use and control of
QuickBooks requires knowledge of the chart of
accounts. The description is here as
part of a foundation. If you want to
jump in quickly, go on to Bank
Accounts. This information will be here
when you come looking (not if you come looking, but when you do.)
The Chart of Accounts, XE
"chart of accounts" in the
financial accounting of any entity, is a list
or tabulation of the various accounts.
We would do well to fine tune our idea of
what “account” means. Sales people
often refer to a customer as an
“account.” And there are some other
meanings. The focus here is on the
meaning in financial accounting. The
complete books of account for any entity
state the initial value, the magnitude of
earnings (or loss,) and the final
value. This usually implies so many
data that it would be utterly confusing to
toss them in all together. An account
is a grouping of similar financial
data. Like or associated records
are collected together. An account is
usually presented in a tabular form, with a
beginning balance, transactions increasing or
decreasing the account, and an ending
balance.
In the discussion below, the term graphics versions refers to versions of QuickBooks for Windows and Macintosh, and excludes DOS versions.
Accounting defines five basic types of accounts:
- Asset
- Liability
- Equity
- Income
- Expense.
The meaning of these was discussed in the “Short Course in Accounting” chapter.
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