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QuickBooks Chart of Accounts - Asset Section

Scott Gregory
August 26, 2008   3 Comment

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Ok, put your bean counter hat on for just a microsecond and get a better understanding of the asset section of the QuickBooks chart of accounts. Remember: assets are things your business owns.

The chart of accounts is nothing more than a big digital filing cabinet that is used to store copies of your QuickBooks transactions (checks, invoices, etc.) When you create a financial report such as the profit and loss in QuickBooks, it rifles through the filing cabinet to put together the appropriate transactions for the report from the filing cabinet.

Click Lists in your menu bar, then Chart of Accounts to access it. When you click the "Account" box in the lower left hand corner and then "New", and you can choose from:

Bank account - not much guesswork here. Your checking and savings accounts would be "bank" accounts in QuickBooks.

Accounts Receivable - unless your business is quite unique, you will only have one account in the chart of accounts called Accounts Receivable. This is the money your customers owe you when you sell to them on credit.

Other Current Asset - something you own that you hope to convert into cash within the next 12 months (or sooner). The classic example of an "other current asset" is inventory. You certainly want your investment in inventory to convert into your checking account in less than a year!

Fixed Asset - used to track your investment in significant items that have a lifespan of more than one year. Examples here are: machinery, computers, buildings, etc. Be sure to check with your CPA on anything classified as a fixed asset in QuickBooks.

Other Asset - the easiest way to remember this is that it is for anything that doesn't fit in any of the other categories above!

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Scott Gregory

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Scott Gregory is a QuickBooks Specialist, QuickBooks Enterprise Specialist and CPA. He has been helping businesses gain a better understanding of QuickBooks software and improve their accounting systems for over twenty years. Scott has trained hundreds of QuickBooks users as an instructor at his local community college. Prior to forming Bottom Line Accounting Solutions, Scott was the CFO for a manufacturing company, with direct oversight of the accounting, IT, inventory control, purchasing and HR departments. Contact Scott today at www.BetterBottomLine.com.

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Comments

Anonymous ( 1 year ago )
Would You list quickbooks as an assets?
Anonymous ( 1 year ago )
Why is the bank balance shown in the Chart of Accounts so different than the detailed account transaction/balance list that comes up when double clicking on that particular account? Denise Denise Morgan denise@tvmanonline.com www.tvmanonline.com
Free C. ( 3 months ago )
Every thing should be taken into consideration before doing any thing so as to avoid conflicts.Like in debit/credit card.Fraud with your credit and debit cards is a possibility for almost anyone. If you are trying to avoid fraud at all costs what is the safest method? It is likely safer to use your credit card, that is assuming you are responsible enough to use a credit card. The issue at hand is that your debit card is directly linked to your bank account, so if your debit card information is stolen all your cash funds could be on hold until the issue is resolved. With a credit card the problem is less threatening because you are using borrowed money so there is no direct link to your earned money.

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