MoneyWorks Manual
Simple Chart of Accounts
As an example of a chart of accounts, consider the following:
| Code | Description |
|---|---|
| 10 | Income |
| 20 | Expenses |
| 30 | Cash* |
| 40 | Accounts Receivable* (Not Cashbook) |
| 50 | Accounts Payable* (Not Cashbook) |
| 60 | GST Collected* |
| 70 | GST Paid* |
| 80 | Fixed Assets |
| 90 | Profit & Loss* |
This is about as simple as you can get — MoneyWorks requires the presence of accounts marked with *. If you use this you will be able to determine your profitability, do your GST, and (if you are using MoneyWorks Express of Gold) know how much you are owed and how much you owe.
However for most businesses it would be inadequate because all the income and expenses are lumped together, so you can’t see how it was derived. It would be more sensible to look at the type of income and expenses that is important to the business and have codes for these. Thus instead of a single expense code we might have:
| Code | Description |
|---|---|
| 20 | Salaries & Wages |
| 21 | Office Expenses |
| 22 | Vehicle Expenses |
| 23 | Other Expenses |
We can then see at a glance how much was paid out in wages, or how much it cost to run the office. But again there is not much level of detail — for example, we can’t determine how much the telephones cost to run, or how much was spent on stationery. This may not be a problem, as we may never be interested in this information. However if we were, we would need to go to a finer level of detail.
It is possible of course to go too far and make things too complicated. If you find that you are agonising over whether an expense should be put under the “Pencils Expenses” code or the “Pens Expenses” code, then you probably have too many codes.