Chart of Accounts
Definition
The chart of accounts is the complete list of accounts a business uses to organize transactions. Accounts are usually grouped by type: assets, liabilities, equity, income, and expenses.
Example
Northstar Creative's chart of accounts includes Checking, Accounts Receivable, Equipment, Accounts Payable, Loan Payable, Owner Equity, Service Revenue, Rent Expense, and Office Supplies Expense.
Why It Matters
The chart of accounts is the structure of the books. A well-organized chart makes reporting accurate and bookkeeping easier.