Quickbooks Chart of Accounts - Arbitrary Numbering?


R

Robert G. Hoover

Are the label Numbers for each account arbitrary in the Chart of
Accounts? For example, QB provides these by default...

15000 - Furniture and Equipment
17000 - Accumulated Depreciation
24000 - Payroll Liabilities
25500 - Sales Tax Payable
30000 - Opening Balance Equity
....
47900 - Sales
....
51100 - Freight and Shipping Costs
....
66000 - Payroll Expenses
....
68100 - Telephone Expenses
68400 - Travel Expenses
68600 - Utilities
80000 - Ask My Accountant
90000 - Estimates

Is this a known CPA labeling/numbering convention? Or are these numbers
completely arbitrary?

Thanks!

Rob
 
E

erica.asahan

Are the label Numbers for each account arbitrary in the Chart of
Accounts? For example, QB provides these by default...

15000 - Furniture and Equipment
17000 - Accumulated Depreciation
24000 - Payroll Liabilities
25500 - Sales Tax Payable
30000 - Opening Balance Equity
...
47900 - Sales
...
51100 - Freight and Shipping Costs
...
66000 - Payroll Expenses
...
68100 - Telephone Expenses
68400 - Travel Expenses
68600 - Utilities
80000 - Ask My Accountant
90000 - Estimates

Is this a known CPA labeling/numbering convention? Or are these numbers
completely arbitrary?

Thanks!

Rob
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=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=
=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D

These are all arbitrary. You can assign any numbers and description
that you like. It's for easy entry and G/L purposes, atleast is what I
know.
 
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A

A Nonny Moose

Robert,

Numbering for the chart of accounts is relatively arbitrary, whether you are
using QuickBooks or actual accounting software. Most accounting systems,
computerized or not, use numbering systems to categorize and differentiate
expenses, keeping it as simple as possible. The labeling is a description
of what the numbers contain, at least in real accounting software. With all
due respect, that does not include QuickBooks, unless you have no concept
what accounting is.

When I said the numbering systems are arbitrary, that was based on the
tradition that there are certain numbering conventions, at least for
placement of the categories. Within those categories, it is your option to
be as creative as your company needs, tracking expenses in as much detail or
as little as is appropriate for your needs. Here are the conventions, to be
used or ignored, as you prefer:

10000 Assets (broken down to current and long term, separated by a subtotal
for current.)
20000 Liabilities (broken down to current and long term, separated by a
subtotal again.)
30000 Equity, with stock, paid in surplus, retained earnings, and year to
date earnings Or simply owner's equity. These days, the least a business
needs is to be a limited liability company to protect one's personal assets.
I don't recommend sole proprietorships unless your business is little more
than a hobby.
40000 Income
50000 Cost of Goods Sold and possibly direct costs of selling, excluding
employee costs
60000-80000 Expenses, sometimes listed alphabetically, others by
direct/indirect, others by any number of schemes, all depending on your
needs and creativity.
90000 Interest Expense and Income Taxes

I have set up charts of accounts for a great number of companies, somewhere
over 200, including an international multi-company conglomerate using this
convention. It is simple and it meets the needs of almost everyone. Using
real accounting software, you can then set up a number of ways of displaying
the accounts in a number of financial statement formats. For instance, your
banker may have a preferred format, while your surety bonding company may
have a different preference. Then, you can set up another version for your
sales staff, your operations manager, the CPA firm, the tax accountant, the
president of the company, the board of directors, etc.

Using what are called master/subsidiary accounts you can summarize for some
people, while giving others account by account detail. For instance, the
president may want a financial statement with 15 lines, while the CPA may
want 90 lines. You can do that by listing Cash as the Master account, with
say all 9 of your checking accounts, CDs, etc. as Subsidiary accounts. That
will give the president 1 line for cash, but the CPA can get a statement
with each one there for separate analysis. This, of course, assumes that
you are using accounting software that allows for this flexibility. I do.
It works so well that I can please everyone. I have my preference, and if
you are interested, I will direct you to where I got my accounting software,
but only if asked. My goal was to instruct and enlighten you, not to sell
you on getting real accounting software. Unfortunately, so many
professionals make so much money by setting up and supporting QuickBooks,
they have a conflict of interest in recommending accounting software to
their clientele.

Good luck,

AJ
 
R

Robert G. Hoover

Hi AJ,

Whew! Thanks for the info. I appreciate the advice and now consider
myself instructed and enlightened. Good stuff! :)

Rob
 
T

tapirgal

Hello,

I am interested in the accounting software you recommend, and I have
to make a decision right away. Actually, it may be made for me by
whatever will or will not convert our Quickbooks Premier 2007
database. We are running out of spaces for new records (names). I've
used QB since 1996, closed the old DB in 2004 and started a new one
when I began to learn how to keep records better. I am NOT an
accountant, but we do need software that will handle inventory and
sales efficiently. We add about 15 to 30 new customers to the DB per
day, as we're an online business with fewer repeat customers than
you'd have with a walk-in only store. I've now purchased both
Peachtree Quantum and MYOB Premier. Neither one will convert the
database of nearly 14,500 (the max) customer + vendor records. Both
purchases are recent and one for sure can be returned. At this point,
although MYOB is much cheaper, I don't care about the price as much as
usability now and into the future. We have about 1,500 inventory
items, and are not a service business. As a nonprofit with a gift
shop, we do keep donation records, but these are much fewer than our
sales. Even though QB is not an "accountant's software," I would have
upgraded to their Enterprise if it could handle unlimited names. It
will only take 29,000, which is double what we have now. We could pay
the $3500 or whatever and probably fill it up in 18 months to 2 years.
Both Peachtree and MYOB have "unlimited" availability for names.

Thanks for any suggestions.

Sheryl
 
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Joined
May 21, 2008
Messages
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Hi Did you tried testing Sage. It is better to handle larger data bases.

Thanks
 

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