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Account Types

Account Types - Does the types of accounts in the drop down make sense?

While creating new account you will find multiple account options in the drop down menu of Account Types. The details of each account type is below.

• Accounts Payable: (AP) are Trade Accounts of businesses representing obligations to pay for goods and services received from suppliers.
• Accounts Receivable: (AR) is a Current Asset representing money due for services performed or merchandise sold on credit to Customers.
• Capital/Equity: in economics can mean: factories, machines, and other man-made inputs into a production process. In finance, Capital is money and other property owned by a corporation or other enterprise used in transacting the business.
• Check or Savings: are Client Accounts maintained by banks, savings; loan associations, credit unions, and mutual savings banks that pay interest but cannot be used directly as money.
• Cost of Goods Sold: (COGS) is a figure representing the cost of buying raw material and producing finished goods. Included are precise factors, i.e. material and factory labor; as well as others that are variable, such as factory overheads.
• Expense: Is the amount of assets or services used during a period. EXPENSES are the daily costs incurred in running and maintaining a business.
• Fixed Asset: are those assets of a permanent nature required for the normal conduct of a business, and which will not normally be converted into cash during the ensuing fiscal period. For example, furniture, fixtures, land, and buildings are all fixed assets. However, accounts receivable and inventory are not.
• Income: Is money received by a person or organisation because of effort (work), or from return on investments.
• Long Term Liabilities: are liabilities of a business that are due in more than one year. An example of a long-term liability would be a mortgage payable.
• Other Asset: is an asset that is not normally part of a companies normal asset list.
• Other Current Asset: is a Balance Sheet item that includes the value of non-cash assets due within one year. Other Current Assets include accrued revenues and deferred expenses, which are recognized in allocating revenues and expenses periodically. Prepayments in advance are also included in Other Current Assets.
• Other Current Liability: is a Balance Sheet entry used by companies to group together current liabilities that are not assigned to common liabilities such as debt obligations or Accounts Payable. Companies will group together these Other Current Liabilities into one account on the Balance Sheet for the sake of simplicity.
• Other Expense: defined as Other Expense Accounts for expenses not covered through regular operating or miscellaneous expense accounts or cost of sales accounts.
• Other Income: is income from activities that are not undertaken in the ordinary course of an Entity's business.
• Current Assets: are those assets of a company that are reasonably expected to be realized in cash, or sold, or consumed during the normal operating cycle of the business (usually one year). Such assets include Cash, Accounts Receivable and money due usually within one year, Short-term Investments, Inventory Asset, Un-deposited Funds, Voucher Assets, Supplier Prepayments, Work in progress and prepaid expenses.
• Current Liabilities: are liabilities to be paid within one year of the balance sheet date and include Payroll Liabilities, Tax Payable, Vouchers, Customer Payments, Un-invoiced Purchase Orders and Un-invoiced Sales Orders.