Kristina's Bookkeeping Blog

A Simple Bookkeeping Chart of Accounts for Small Business

I have been asked many times if there is a simple bookkeeping Chart of Accounts for small business. You would think NOT when you do an online search on “Chart of Accounts,” but this is untrue. Most small businesses can start simple and add accounts as business gets more detailed. A true chart of account is numbered, but with the invention of small business accounting software such as QuickBooks, it is not necessary to use a numbered Chart of Accounts. Here is an example:

Account Name Type
Checking Bank
Savings Bank
Petty Cash Bank
Accounts Receivable Accounts Receivable
Inventory Other Current Assets
Furniture & Equipment Fixed Assets
Accumulated Depreciation Fixed Assets
Prepaid Expenses Other Assets
Accounts Payable Accounts Payable
Loans Long-term Liabilities
Payroll Taxes Payable Other Current Liabilities
Sales Tax Payable Other Current Liabilities
Member’s Draw Equity
Member’s Equity Equity
Sales Income
Cost of Goods Sold Cost of Goods Sold
General & Administrative Expense
Insurance Expense
Marketing Expense
Payroll Expense
Professional Fees Expense
Travel & Entertainment Expense
Utilities Expense

As you can see, this is a very simple, abbreviated chart of accounts, but it works and it can easily be expanded as you want more detail. For example, when you want to know more about what specific types of sales you are making, you would create new detail in the income category. It might look like this:

Payroll Service Sales Income
Bookkeeping Service Sales Income
Financial Statements Sales Income

This is also true for the expense categories. All of these categories can have sub categories attached to them so you can see more specifically where you are spending in that category. An example would be:


Payroll Service Expense
Payroll Taxes Expense
Wages Expense

So, my advice is to start your chart at the level you are now, and let it grow as the bookkeeping needs of your company grows. There is no need to overwhelm yourself with more detail than you need. It is better to have your information in an easy format, that you can just hand to your CPA at the end of the year, than to be overwhelmed by it, and not do it at all.

Please feel free to contact me with any bookkeeping or accounting questions for your small business.

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