A standard chart of accounts (or COA) is organized according to a numerical system. The Chart of Accounts numbering convention states that each major category will begin with a certain number, and then the sub-categories within that major category will all begin with the same number.
If assets are classified by numbers starting with the digit 1, then cash accounts might be labeled 101, accounts receivable might be labeled 105, inventory might be labeled 112, and so on. Whereas, if liabilities accounts are classified by numbers starting with the digit 2, then accounts payable might be labeled 201, short-term debt might be labeled 202, and so on.
Chart of Accounts – Numbering Convention Example
Starting #
Account Type*
Comments
1000
Bank
1100
Accounts Receivable
1200
Other Current Asset
This would contain your Inventory account
1300
Fixed Asset
1400
Other Asset
2000
Accounts Payable
2100
Credit Card
2200
Other Current Liability
2300
Long Term Liability
2500
Equity
4000
Income
5000
Cost of Goods Sold
6000
Expense
AKA: Overhead. Contains fixed and variable.
9000
Other Income
9500
Other Expense
Tips
These are the fifteen different account types found in Total Office Manager. Within each type, you would enter your own specific account. An example would be “Rent” or “Utilities”.
Chart of Account Types
When entering your accounts, please be sure to separate each account by at least ten numbers (such as 1010, 1020, 1030, etc).
Understanding Account Types used in the Chart of Accounts
This article explains the use of Chart of Accounts – Account Types. Here, various account types are defined and explained. We will explain what the (Chart of Account) account types are and how to use them to keep your contracting company’s finances organized and accurate.
This topic may be helpful if you are setting up accounting software or want to learn more about the chart of accounts and accounting.
Why Account Types Matter
The chart of accounts is the backbone of Total Office Manager and the foundation of your company’s accounting system. It’s important to set it up correctly, and understanding account types and detail types is a key part of that.
Understanding the Importance and Purpose of COA Account Types
When you’re setting up your chart of accounts, choosing the right account type is crucial because your business’s accounting is built around account types. The account type determines which financial report QuickBooks adds each account’s data to. Choosing the right account type sets you up with accurate reports, such as the balance sheet and profit and loss reports, so you can analyze the financial health of your business.
Accounts that have an opening balance feed into the Balance Sheet report. These include accounts payable and receivable, asset accounts, liability accounts, equity accounts, and credit card and bank accounts. The Profit & Loss report is fed by your business income and expense accounts, including cost of goods sold accounts as well as other income accounts like interest earned or other expense accounts like depreciation expenses.
Accounts Types at a Glance
Balance Sheet Accounts
Accounts Receivable, Accounts Payable, Bank Account, Credit Card, Fixed Assets, Current Assets, Other Assets, Other Current Assets, Current Liabilities, Other Current Liabilities, and Equity.
Income Statement Accounts
Income, Cost of Goods Sold, Expenses, Other Income, and Other Expense.
What is Chart of Accounts
Your company’s chart of accounts is a complete list of all account names that will be used in the General Ledger. Each account is usually associated with a numerical account ID to help locate it when recording data. Accounts are used to classify transaction information for reporting purposes.
Chart of accounts can vary depending on the business type. You should ask a qualified person to help you set up a good chart of accounts for your company. If you use specialized contractor software or a service industry accounting software program, such as Total Office Manager® from Aptora Corporation., the program will have a set of professionally designed chart of accounts for you to select from.
Using the Chart of Accounts List
A chart of accounts list is used every time you enter a new client, inventory item, bill, and more. These are the same accounts that appear on your company’s income statement (profit and loss statement), balance sheet, and other financial reports. These accounts might include Labor Income, Parts and Materials, Technician Wages, Rent, Insurance, Office Wages, and more.
Defining Account Types in Detail
Total Office Manager uses the following account types in its Chart of Accounts List. This information is provided for reference for those researching the various account types that make up a chart of accounts. These accounts are essentially universal and independent of what accounting software system you are on.
Chart of Account Types
Accounts Receivable
A/R is a form of current assets. It is money owed by clients for items or services sold to them or for materials furnished by the company when cash is not received at the time of sale. Typically, accounts receivable balances are recorded on sales invoices that include terms of payment. Accounts receivable is used in accrual-based accounting.
Accounts Payable
A/P is a form of current liabilities. The amount of money owed to vendors for goods, supplies, and services purchased on an open account. Accounts payable balances are used in accrual-based accounting, are generally due in 30 or 60 days, and do not include regular interest. Please do not confuse with Notes Payable.
Bank Account
This is a current asset. Add one bank account for every account your company has at a bank or other financial institution.
Fixed Assets
They represent property, plant, or equipment assets that are acquired for use in a business rather than for resale. They are called fixed assets because they are to be used for long periods of time.
Current Assets
These accounts will be converted into cash within a year. Current assets include the following account types: cash, accounts receivable, inventory, and other current assets.
Other Assets
They represent those assets that are considered nonworking capital and are not due for a relatively long period of time, usually more than one year. Notes receivable with maturity dates at least one year or more beyond the current balance sheet date are considered to be non-current assets.
Other Current Assets
Represent those assets that are considered nonworking capital and are due within a short period of time, usually less than a year. Prepaid expenses, employee advances, and notes receivable with maturity dates of less than one year of the current balance sheet date, are considered current assets.
Current Liabilities
These are obligations (payments) due within one year. Current liabilities include the following account types: accounts payable and total current liabilities.
Other Current Liabilities
Represent those debts that are due within a short period of time, usually less than a year. The payment of these debts usually requires the use of current assets.
Expense (aka: Overhead)
Also known as “Overhead”, money spent on normal administrative activities such as rent, insurance, office wages, utilities, telephone, and more. Please also see Cost of Goods Sold.
Fixed and Variable Overhead
It is very important to separate your overhead into fixed and variable types. Fixed overhead remains essentially unchanged within a certain range of income. Examples include salaries, liability insurance, and rent. I like to refer to variable overhead as “somewhat variable overhead” because it varies slightly with changes in income. Examples include gasoline, small tools, office supplies, and legal fees.
Note: If income exceeds expenses; a net income is produced. If expenses exceed income, the business is said to be operating at a net loss.
Other Expense
Money spent on something other than normal business operations, such as corporate taxes.
Cost of Goods Sold
The cost of goods and materials held in inventory and then sold. Represents the known cost to your business for items or services when sold to clients.
Note: Cost of Goods Sold (also known as Cost of Sales) for inventory items are computed based on the inventory costing method (FIFO, LIFO, or Average Cost).
Income (AKA: Sales or Revenue)
An account used to record revenue. (money coming into your company). These accounts are way of categorizing or separating out your income. They represent the inflow of assets resulting from the sale of products and services to clients. If income exceeds expenses a net income results. If expenses exceed income, the business is said to be operating at a net loss.
Other Income
Money received for something other than normal business operations, such as interest income.
Credit Card (account)
A current liability account, this is used for credit card purchases, bills, and payments.
Long Term Liability
Represent those debts that are not due for a relatively long period of time, usually more than one year. Portions of long-term loans due and notes payable with maturity dates at least one year or more beyond the current balance sheet date, are considered to be long term-liabilities.
Owner’s Equity
The sum of the following account types: equity – doesn’t close, equity retained earnings, equity – gets closed, sales, cost of sales, and expenses.
Equity
Equity, also known as capital, is the original investment in a company, or the claims against assets.
Retained Earnings
The Retained Earnings account is updated at the close of the fiscal year with the ending balance of your income and expenses (net income). The balance in the retained earnings account continues to accrue at the end of each fiscal year.
Designated Accounts
These are accounts automatically created by Total Office Manager. You will find these accounts have already been added to your Chart of Accounts. The software must have these accounts. They cannot be deleted.
A small business may choose to use a line of credit to cover short term cash shortages. Lines of credit can take many forms. Generally, a company makes a request to borrow money against its line of credit via fax or email. The money is then electronically deposited into the company’s bank account. The business may pay interest only or a combination of interest and principle monthly. These payments are typically made electronically by the bank per the company’s request, and no checks are sent or received. When this happens, a company will need to set up a loan or a line of credit within Total Office Manager.
To set up a line of credit to show interest expenses and principle payments, follow the steps below that best suit your needs:
Note: The accounts used here are for illustrative purposes only. Please consult your accounting professional for the exact accounts to use.
Form Access
From the main menu, click Banking | Chart of Accounts List. Right-click anywhere in the list and select New Account from the fly-out menu.
New Chart of Account
Field & Button Definitions
Create a long-term liability account to track what you owe:
Chart of Account – Long Term Liability
Type – Choose Long Term Liability as the account type.
Number – This number can be auto-generated by Total Office Manager, or you can choose to input your own reference number for this account.
Name – Enter an appropriate name (“Line of Credit” for example) for this account to track the liability.
Subaccount of – This is not a subaccount, so leave this field blank.
Note – Enter any appropriate notes regarding the chart of account.
Description – Enter any description you feel necessary to describe this account and its purpose.
Inactive – This checkbox should remain unmarked as long as this account is active.
Once all fields have been filled out, click the Next button to set up the next account.
Create an account to track interest payments (expenses):
Chart of Account – Expense
Type – Select Expense from the drop-down menu.
Number – This number can be auto-generated by Total Office Manager, or you can choose to input your own reference number for this account.
Name – Enter an appropriate name (“Line of Credit – Interest” for example) for this account.
Subaccount of – This is not a subaccount, so leave this field blank.
Bank Acct. No. – Enter the number of the bank account, if applicable.
Opening Balance – Leave this field blank.
As of – Leave this field blank.
This Account is Used for Inventory Purposes Only – Leave this checkbox unmarked.
Description – Enter any description you feel necessary to describe this account and its purpose.
Inactive – This checkbox should remain unmarked as long as this account is active.
Once all fields have been filled out, click the OK button to close the window.
Depositing money from your line of credit:
To deposit the money that has been borrowed against your line of credit into the company’s bank account, follow these instructions:
From the main menu, select Banking | Make Deposits, or use the keyboard shortcut Ctrl + D to open the Add Deposit form.
Make Deposit File Path
Add Deposit
Deposit to – Select the bank account into which your bank will transfer the money.
Date – Enter the date of the actual transfer.
Entry # – Enter some type of code in this field that relates to the transaction. One recommended option is to enter the letters “ACH” followed by a transaction number. This can be the current date, your loan request number, a number assigned by the bank, or an internal number.
Memo – Enter notes in this field explaining the source of the loan and any other pertinent information necessary.
Received From – Select your Bank from the drop-down menu. Your bank should already be set up as a vendor. If your bank is not set up as a vendor, use the <Add New> option, to create an account for your bank.
From Account – Select your new account “Line of Credit”.
Memo – Enter any notes you feel are necessary in this area.
Check # – If the funds were received in the form of a check, enter the number of the check in this field. Otherwise, you can leave blank or enter another number/code for internal purposes.
Pmt Meth. – Select the appropriate payment method type from the drop-down menu. If the transaction is paperless, it is recommended to use “ACH”. These letters indicate that this was an electronic transaction.
Amount – Enter the amount of the loan in this field.
Dept. – Enter the department that will receive the funds, if applicable. Otherwise, leave blank.
Double check your work, and then click OK.
Once these steps have been completed, the money borrowed from the line of credit will appear in the company’s bank account, and the transaction will be set up as a Long Term Liability.
Make an interest or loan payment:
When scheduling the repayment of a Line of Credit against which your company has borrowed, it must first be determined whether the payments will be interest payments or payments against the principle (the money borrowed). Typically, banks will automatically withdraw money from a company’s bank account each month to cover interest charges. This section explains how to record that event:
From the main menu, select Banking | Write Checks or use the keyboard shortcut Ctrl +W to access the Write Checks form.
Write Checks File Path
Write Check Form
Bank – Select the account from which the payment will come.
Pay to the order of – Select the institution that holds the company’s Line of Credit and to which the payment will be sent.
No. – Enter an internal code for the ACH transaction. One recommended option is to enter the letters “ACH” followed by a transaction number. This can be the current date, your loan request number, a number assigned by the bank, or an internal number.
Date – Enter the date of the actual transfer.
Memo – Enter a memo explaining the payment, etc.
On the Expenses tab:
Write Check – Expense Tab
Account – Select “Line of Credit – Interest” account. When making a payment against the principle (the loan amount), select the Line of Credit account.
Amount – Enter the amount of the interest paid. The interest amount will be shown on the company’s bank statement or recorded as a transaction on the bank’s website. When making a payment against the principle (the loan amount), enter the principle payment amount.
Double check your work, and then click Save & Close.
The above actions (less the last two steps) will increase the interest expenses on the company’s Income Statement. If the payment was for the principle, the Line of Credit amount (on the Balance Sheet) will be lowered.
Tips
Smart Account Filtering is a safety feature in Total Office Manager. When Smart Account Filtering is enabled, only proper account types appear as options, which eliminates the mistake of selecting improper account types for a given transaction. This preference may need to be disabled (turned off) in order to see the “Line of Credit” account in the Make Deposit form and the Write Check form. This option is found on the Chart of Accounts tab of the Preferences form (Edit | Preferences).
If, after receiving the company’s bank statement, it is found that the interest paid differs from the interest due, the check can always be edited to reflect the correct amount. Adjustments can also be made as Journal Entries, but Adjusting Journal Entries are typically not recommended
Total Office Manager does provide a file to support the Positive Pay standard which helps reduce fraud and theft. This standard is a requirement of some banks. By submitting a Positive Pay™ file to your bank, this helps the bank prevent check fraud by examining questionable checks submitted for payment from your account and then determining whether each check should be paid or returned.
Column 1 contains a I or C to indicate the status of the check.
“I” will appear for checks which have been issued.
“C” will appear for any check which has been voided.
Column 2 is the account number located in the Bank Chart of Account.
Column 3 is the check number.
Column 4 is date of the check. This date is formatted as MDDYY.
Column 5 is the amount of the check.
Column 6 is the pay to located on this check. This is either a customer, vendor, or employee.
Tip Related to Positive Pay
It may be necessary to modify the file to meet your bank’s specifications. Please contact your banking institution to determine their requirements and processes for uploading this file to their system.
The Positive Pay export is formatted as a CSV file. Based on your computer settings, this file may open in MS Excel by default. Opening in MS Excel may change the formatting to meet your application settings. Examples: numbers may appear in scientific notation, leading zeros may be omitted, etc. You may change the default application to open by right clicking on the csv file, choose Open with…. and change the default file association to Notepad.
This advanced topic explains Journal Entries. They are also known as Adjusting Journal Entries or AJE for short. In traditional accounting, a record of a transaction in which the total amount in the Debit column equals the total amount in the Credit column, and each amount is assigned to an account on the chart of accounts.
Form Access
From the main menu, click Banking | Make Journal Entry, or
Make Journal Entry File Path
From the main menu, click Banking | Journal Entry List. Then, select Journal Entry List | New from the menu.
New Journal Entry
Usage
The recording of a business transaction in a record window is used for accountants or people who prefer the traditional system of accounting by entering transactions in a general journal.
If you are not an accountant, you might use the general journal to transfer amounts from an income or expense account to another, or from one class to another.
Your accountant’s review of your books may require that you make adjustments to various accounts, such as adding the depreciation of a fixed asset. To add these adjustments in Total Office Manager, you can use the General Journal Entry window.
If you are a bookkeeper and are unfamiliar with how a general journal works, you should do some research. This is a very common accounting function.
Additional Details
AJE’s serve these functions:
They adjust balances. This means that they change the amounts that go to financial statements.
Reclassifications. These AJE’s move balances from one account to another.
Accountants put some AJE’s to special uses:
Recurring entries – These entries are the same each month. They always have the same amounts and go to the same accounts.
Reversing Entries – AJE’s may not be permanent. You may wish to reverse them at the beginning of the next period. These are called “reversing entries”.
Example
Payday is not the same day as the end of the month. So, what about the wages that were earned between the last payday and the end of the month? We debit Wages Expense and credit Accrued Wages Liability. This makes our financial statements correct but throws us off for the next month. What to do? Reverse that monster and just go ahead and make your regular payroll entry. We take care of the problem in the next month’s accrual.
How Debits and Credits Affect Account Totals
Credits do not necessarily mean increase and debit does not necessarily mean decrease. It all depends on what account type we are talking about.
A credit increases income, liability, equity, and accumulated depreciation accounts. Credits decrease expense and assets accounts.
A debit increases expenses and assets accounts. Debits decrease sales, income, liability, equity, and accumulated depreciation accounts.
Example of Adjusting Journal Entries
If you wanted to increase your rent account balance by $12,000.00, you would debit the account by $12,000.00. There must always be an offsetting entry made (because the cash had to come from somewhere), so you would credit a bank account $12,000.00.
Here are some typical adjusting journal entries (or AJE’s for short).
Depreciation – The amounts come from a schedule as described here. In the General Journal, we enter a debit to Depreciation Expense and a credit to Accumulated Depreciation.
Amortized Intangible Assets – Treated as depreciation as AJE’s.
Inventory – The amount of the adjustment as described elsewhere is the difference between the ending inventory amount and the booked amount. Debit or credit Inventory as needed and balance your entry by debiting or crediting the Cost of Goods Sold.
Payroll Tax Liabilities – These affect the appropriate liability accounts and payroll tax expense accounts. Here’s more info.
Loan Balances – At least once a year we like to compare the balances on our books to what the bank says are the balances. We adjust the differences to Interest Expense.
Accruals – These can be a whole lot of different things. Asset and liabilities are adjusted to Revenues and Expenses.
Field Definitions
Date
The current date will populate this field automatically.
Entry #
The next JE Number will populate this field automatically.
Account
Enter the account number that the transaction will affect (from drop-down menu). If you are using an A/R or A/P account, the first account in the G/ L transaction should be the accounts A/R or A/P account.
Debit
Enter the debit amount for the account you entered.
Credit
Enter the credit amount for the account you entered.
Memo
Optional: Enter any pertinent information pertaining to the transaction (the amount), which will be helpful for future reference. The memo appears on reports that include the general entry.
Name
Enter the name of the vendor, customer, employee, or other name associated with the amount. If the entry is for an A/R or A/P account, you must select a name. The Customer:job name is used in Job Costing as well as makes the item available on a sale or invoice as “reimbursable”.
OK
Save and Close
Step-By-Step
From the main menu, click Banking | Make Journal Entry.
If you wish to create a new journal entry, click in the field under Account.
If you wish to edit a new journal entry, click in the field to edit.
If you wish to delete a journal entry, click on the red X, just before the Account field.
Or
From the main menu, click Banking | Journal Entry List.
If you wish to create a journal entry, select the Journal Entry button (bottom left corner of form) and choose New Journal Entry.
If you wish to edit an existing journal entry, select the journal entry button (bottom left corner of form) and choose Edit Journal
If you wish to delete an existing journal entry, select the journal entry button (bottom left corner of form) and choose Delete Journal Entry
Tips for Adjusting Journal Entries
You can delete multiple journal entries. To highlight multiple journal entries, press and hold your CTRL key and click each journal entry. You may also select a range of journal entries by highlighting the first journal entry in that range, pressing and holding your left Shift Key, and clicking the last journal entry in that range.
You can select a journal entry and right-click for common tasks.
Continue to enter distribution lines until the transaction reaches a zero balance (the total in the Debit column equals the total in the Credit column).
Do NOT use AJE to adjust Payroll Liabilities. General journal entries do not affect payroll liabilities. To adjust your payroll liabilities, from the Employee menu, choose Adjust Payroll Liabilities.
If an expense account has mistakenly been associated with a payroll item in place of a liability account, you can edit the payroll item: From the Lists menu, choose Payroll Items
General journal entries appear in the journal for any balance sheet account A record of similar transactions under one title in the ledger. Example: Sales, rent, utilities, labor, cost, insurance, etc. Basically any item found on an income statement or balance sheet is referred to as an account. These accounts were entered into TOM using your Chart of Accounts.involved.
The Chart of Accounts List is used to manage your financial accounts. The Chart of Accounts is often referred to as COA.
Accounts are used to record and summarize the increases, decreases, and balances of each asset, liability and owner’s equity items (like accounts receivable, accounts payable, and retained earnings). Financial accounts track your business transactions.
New accounts may need to be created as your business grows and changes. For example, if you begin accepting credit cards, you might want to set up an account for credit card transactions.
COA Numbering
When creating new accounts, the account numbers are automatically proposed in intervals of ten (10010, 10020, 10030, etc). Proposed account numbers can be overridden as necessary.
COA Sub-Accounts
If you want to make this account a sub-account of another account, select the account from the drop down menu and select the account that would be the higher-level account for this sub-account.
If a particular account in COAs seems to cover too much, you can divide the account into one or more sub-accounts. Sub-accounts let you track several related types of income or expenses independently yet keep them all under the all-inclusive of a single parent account.
Example:
In the parent account “Phone” you might want to set up sub-accounts for cell phones, local phone service, long distance service, toll free phone service, and pagers. You could then track how much your company spends on long distance, cell phones, etc. individually, but still have the ability to know exactly how much you pay out in the utility ‘Phone”.
COA Types
Account types define the role of each account and how it behaves. The various account types available include:
Bank – Used for bank accounts (ie: Checking, Savings, Special Payroll Savings Account, etc).
Accounts Receivable – Used to track money customers owe.
Other Current Asset – Used for other assets such as petty cash, prepaid expenses, and other items.
Fixed Asset – Assets which are owned by the company but not likely to be converted into cash within one year.
Other Asset – Miscellaneous assets which are neither “current” nor “fixed”.
Accounts Payable – Used to track money owed to vendors.
Credit Card – Used to track credit card purchases and payments.
Other Current Liability – Liabilities to be paid in full within one year.
Long Term Liability – Liabilities not to be paid in full within one year (ie: building loan, car loan).
Equity – Owners equity, investments, draws and retained earnings.
Income – Money received for the sale of goods and services.
Cost of Goods Sold -The direct costs associated with acquiring and selling goods.
Expense – The indirect costs (overhead) of running a business (ie: office staff wages, utilities, copier paper, pens).
Other Income – Miscellaneous “windfall” income received from non-typical activity.
Other Expense – Miscellaneous abnormal expenses.
Form Access
From the main menu, click Banking | Chart of Accounts List or
Chart of Account File Path
From the main menu, click List | Chart of Accounts.
Lists – Chart of Accounts
COA Usage & Menu Options
Menu options for the Chart of Accounts list are located under the Chart of Accounts List option in the upper left corner of the form. You may quickly access this menu by using holding down the ALT key and typing C or right clicking anywhere on the list.
Chart of Account Menu Options
To create a new account, right click anywhere in the list and choose New Account from the pop-up menu. See more on this action below in Creating/Modifying Accounts.
To edit an account, you may double click to open or right-click on it and choose Edit Account from the pop-up menu.
To delete an account, right-click on it and choose Delete Account from the pop-up menu.
Note: You may not delete an account which has history. Inactivating the account is the action to take if you no longer wish to use the item.
To inactivate an account, right-click on it and choose Make Account Inactive from the pop-up menu. This can also be done by checking the “Inactive” checkbox within an account.
To merge one account with another, right-click on the source account and choose Merge COA from the pop-up menu. See more on this action below in the Merging Accounts section.
To quickly create a spreadsheet of the work order type list, right click and choose Save/Open List in MS Excel from the pop-up menu.
Note: If you are on the Aptora Hosted platform, you will need save to this format to the work resources folder and then open on your local workstation.
To export whatever information is currently displayed in the list, right-click anywhere in the list and choose Export List from the pop-up menu.
To quickly highlight all visible records, right click and choose Select All from the pop-up menu.
To quickly remove any highlighting, right click and choose Unselect All from the pop-up menu.
To modify which columns are displayed in the list, right-click anywhere in the list and choose Form Preferences | Show Columns from the pop-up menu.
Creating/Modifying Accounts
The following are general steps for creating a new account.
Please Note: When creating a new account, some fields may vary depending on the type of account. Specialized fields particular to a certain account type will appear with the account type only. For example, when creating a new account of the type “Bank”, fields like “Bank Acct No” and “Routing” will be available. Or when creating a new account of the type “Other Asset” or “Other Current Asset”, the unique checkbox “This Account Is Used For Inventory Purposes Only” will be available.
Step-by-Step
Right click anywhere in the list and choose New Account from the pop-up menu. The “Add Account” form will appear.
Choose an account Type from the drop-down list.
Propose, except, or modify the account Number as necessary.
If you would like to make this account a child of another account, select the parent account as the Subaccount Of.
Enter an account Description, if necessary.
Complete any other available fields as applicable to the account type being created. These will vary depending on the account type being setup. For certain account types, you will see different fields.
Bank accounts allow for entry of the account and routing numbers.
Credit Card accounts accounts allow for entry of the account number and the require selection of the vendor the credit card is payable.
Other Current Asset and Other Asset accounts allow for indication the account is used for inventory activities. This option is used in the Financial Analysis and Contractor Compass for amounts dealing with inventory.
Income, Cost of Goods Sold, Other Income, and Other Expense account types have a What Best Describes This selection. This selections allows for classification These selections are referenced when running reports like the Job Costing Overview, Job Cost by Job Status, Contractor Compass, and various CDVs.
Expense and Other Expense account types have an Overhead Allocation Method selection. Selections are None for no selection, Income (% of sales), Direct Labor (% of total direct labor), and MESO (% of non-labor direct expenses).
Expense account types have a Fixed or Variable field for selection. Selections are 0 for None, 1 for Fixed, and 2 for Variable.
All accounts with exception of Accounts Receivable, Accounts Payable, Other Current Liability, and Long Term Liability offer the ability to enter an opening balance when creating a new account. For any of the accounts excluded, please create the opening balances using the appropriate transaction. Example, creating a new liability account to track a new line of credit, enter a deposit and select the new account. For more information on creating this entry, please review the article Setting Up a Loan or Line of Credit.
Click the OK button to finish and close the form, or click the Next button to save and go on to create another.
Merging Accounts
If it becomes necessary to merge one account into another, use the “Merge COA” command. Be extremely careful when performing this action. It is strongly recommended that a backup of your database be created prior to merging COA accounts.
Sample Chart of Account Merge
To merge one account with another, right-click on the source account and choose Merge COA from the pop-up menu. The “Chart of Accounts Merge” window will appear.
The “Merge From” field should display the account on which you originally clicked in the Chart of Accounts List. If it does not, or the account should be another one, select it from the drop-down list.
Select the “Merge To” account from the drop-down list. This is the target account to which the “Merge From” source account info will be transferred. The “Merge To” drop-down list will contain only accounts of a similar type as the “Merge From” account. For example, if the source account is a “Bank” type of account, then the list of target accounts will only contain “Bank” type accounts, not “Expense” accounts or other dissimilar account types. In other words, merging which does not make accounting sense
If desired, tick the “When complete, Inactivate the “Merge From” Account” checkbox to enable that action.
Click the “Merge” button. A verification window will appear which explains that the merge action cannot be undone. Click “Yes” to confirm and continue with the merge. A notification will appear when the merge process is complete.
Carefully check the “Merge To” target account to verify that the results are as expected.
Security Settings
The following user list/security permissions (Company | User List/Security) are required for accessing work order types:
Please Note: You may give someone access to add without having edit permissions. We do not recommend users have permissions to void or delete unless it is vital to their day to day operations.
Chart of Account Tips
It is generally recommend to avoid deleting accounts. Consider Inactivating accounts instead.
Use expense accounts to track reimbursed expenses as income.
This topic explains the use of the Make Deposit form. You will lean how to make deposits for your Undeposited Funds account. Undeposited Funds appear on your Balance Sheet when using the Group with Other Undeposited Funds feature. Please read the helpful Tips section at the bottom of this page.
Using the Bank Deposit Feature
This form makes it easy to quickly deposit customer payments that Total Office Manager has been holding in your Undeposited Funds account.
The Undeposited Funds account is the account that Total Office Manager automatically adds to your chart of accounts the first time you receive a payment from an Invoice or sales receipt. Total Office Manager uses this account to hold money you have collected until you deposit it in a back account.
Form Access
From the main menu, click Banking | Make Deposit.
Make Deposit File Path
Bank Deposit Form: Field & Button Definitions
Here is a list of each field and each button found on the Bank Deposit form along with a good definition for each.
Add Deposit Form
Deposit To – From the drop down menu, select the account you want to make the deposit to.
Date – The current date will populate this field automatically. You may change the date if you wish.
Entry No – The next available number will populate this field automatically. You may change the date if you wish.
Memo – Populates automatically with the word “Deposit”. You can change this if you wish.
Received From – From the drop down menu, select the vendor, customer, or employee you received the payment from.
From Account – From the drop down menu, select the account from which the payment is being applied against.
Memo – Optional: Enter any pertinent information pertaining to the transaction (the amount), which will be helpful for future refer.
Check No – Enter the Check No. you are depositing.
Payment Method – From the drop down menu, select the type of payment you are depositing. Cash , Credit Card, Check, etc.
Amount – Enter the amount of the cash, check, or credit card you are depositing.
Department – Enter the corresponding department the deposit is associated with the Customer:Job/Employee/Vendor.
Cash Goes To – Indicate what account you want the cash back to be applied to. Cash, Petty Cash, Cash Drawer, etc.
Cash Back Amount – Enter the dollar amount of the cash back. More on this below.
Cash Back Memo – Optional: Enter why you are getting cash back or any other information.
Payments – The Payments button opens the list of payments (undeposited funds) awaiting deposit. This list may be sorted in similar fashion as other lists by clicking on the header of the column in which to sort. Tick the checkbox for each payment to include in the deposit. Use the “Select All” or “De-Select” buttons if helpful. When finished, click the “Close” button to return to the “Add Deposit” form along with the ticked payments.
Print Deposit Summary – The Print Deposit Summary button prints a hard copy of the deposit summary.
Print Deposit Slip – The Print Deposit Slip button prints a hard copy of the deposit slip.
OK – The OK button saves and changes and exits the form.
Step-By-Step Bank Deposits
Open the form.
Click the Payments button and from the Payments list, select which undeposited funds to include in the deposit.
Complete the remaining fields as necessary, per above descriptions.
Another Bank Deposit Option:
Open the Manual Deposit List form.
If you wish to create a new deposit, select the Manual Deposit button (bottom left corner of form) and choose New Deposit.
If you wish to edit an existing deposit, select the Manual Deposit button (bottom left corner of form) and choose Edit Deposit.
If you wish to delete an existing deposit, select the Manual Deposit button (bottom left corner of form) and choose Delete Deposit.
Bank Reconciliation Tips
To make reconciliation with your bank statement easier, do a separate “Make Deposit” for each payment method, such as cash/checks, MasterCard, Visa, and so on. Example. Select all cash payments, complete all the steps in the procedure, then start over and select the deposit payment from on credit card, then those from another credit card, and so on. You should see the total for each payment method listed on a separate line in the deposit section of the Reconcile window .
Other Bank Deposit Tips
Total Office Manager does not recommend that you receive cash back from a deposit. This is NOT considered good professional accounting. If you want cash, write a check and cash the check.
For money you received but did not invoice for such as, refunds from vendors on products, money an owner is investing in the company, or rebates use the ‘Manual Deposit List’ found at Banking | Manual Deposit List.
If depositing a payment made by credit card, enter the credit card fees as a value in the “Cash Back Amount” portion of the “Cash Back” section of the Deposit form. This should also include the account and memo.
If you are entering a refund from a vendor, enter the vendor name. If this refund is for the return of items entered on a bill credit, enter the Accounts Payable account in the From Account column. A record of similar transactions under one title in the ledger. Example: Sales, rent, utilities, labor, cost, insurance, etc. Basically any item found on an income statement or balance sheet is referred to as an account. These accounts were entered into TOM using your Chart of Accounts column. If the refund is for a discount or over-payment, enter the expense account of the original expense in this column.
We recommend that you create a Total Office Manager ‘bank’ account called Cash Drawer to track your cash-on-hand.
If you want to keep some cash on hand instead of depositing it, leave one of the cash payments unchecked. Repeat the Make Deposit procedure for that cash payment by itself, and deposit it to the Cash Drawer account.
You can delete multiple deposits. To highlight multiple deposits, press and hold your CTRL key and click each deposit. You may also select a range of deposits by highlighting the first deposit in that range, press and hold your left Shift Key, and click the last deposit in that range.
You can select a deposit and right click for common tasks. When you make deposits at your bank, you probably make out separate deposit slips for amounts you’d like to have listed separately on your bank statement. You may do the same thing in Total Office Manager, so that your separate payment methods appear separately when you reconcile the bank account (this method makes it easier and faster to reconcile your account.)
You may want to group more than one day’s credit card payments (depending on when your bank usually credits you account). Example: Suppose your bank credits your account for credit card payments every Tuesday and Thursday. You would deposit Friday’s, Monday’s, and Tuesday’s credit card payment on Tuesday in Total Office Manager (even though you may take the payments to the bank every day.
You cannot deposit credit card payments when using a printable deposit slip.
The Manual Deposits List is used to review, research, and generally manage your manual bank deposits.
Form Access
From the main menu, click Banking | Manual Deposits List, or
From the toolbar, click the drop-down arrow on the “Make a Deposit” button, then select “Manual Deposits List”.
Usage
Perhaps the easiest way of using the commands available in this list is through it’s right click menu. The right click menu is identical to the title menu.
To create a new deposit, right click anywhere in the list and choose New Deposit from the pop-up menu.
To edit a deposit, right-click on it and choose Edit Deposit from the pop-up menu.
To delete a deposit, right-click on it and choose Delete Deposit from the pop-up menu.
Note: It may not always be possible to perform this action, depending on subsequent bank reconciliations and other historical events which have involved the deposit.
To export whatever information is currently displayed in the list, right-click anywhere in the list and choose Export List from the pop-up menu.
To modify which columns are displayed in the list, right-click anywhere in the list and choose Form Preferences | Show Columns from the pop-up menu.
This topic will cover the management of Direct Deposit Setup files.
Usage
Use this form to add, delete, or edit the various Direct Deposit Setup files that you have created. A Direct Deposit Setup file is the information you need for direct deposit related to Total Office Manager. You can have multiple setup files but most companies will only need one.
IMPORTANT: Direct Deposit is something that you must sign-up for with your bank. You must then setup direct deposit in Total Office Manager.
Form Access
First open the Direct Deposit Company Setup List. From the main menu, click Banking | Direct Deposit | Company Setup. The list will appear.
Click the “Add New” button to open the Direct Deposit Setup form.
Field Definitions
Use This Bank Account for Direct Deposit – Tick this checkbox if the vendor wished to participate in the direct deposit program. We recommend that you get this desire in writing.
Account Type – Select the type of bank account you are using. Your choices are Checking and Savings.
Default Entry – This helps identify what the transaction is for. An example might be “Payroll” or “Bill Payment”. You can always enter something different here when you create the direct deposit. You do not have a lot of room here but that is a direct deposit restriction and not a Total Office Manager restriction.
Federal Tax ID – This number is assigned to you by the federal government of the USA. It may be found in the Company Information form. This number is VERY important and must be entered precisely.
Routing # – The routing number of the bank account. Found on the bottom of the check. This number is VERY important and must be entered precisely.
Account # – Enter the bank account number of the account you will be drawing money from.
Add 9 line – Total Office Manager’s direct deposit file is absolutely NACHA compliant and follows the rules and regulations governing the ACH network. There is however, one setting which may be required from you in Total Office Manager. NACHA rules require that an ACH file be at least nine lines in length. Some banks collect all of their customers’ ACH files, combine them into one file, and send that single large file to the clearinghouse. Other banks send each customer file to the clearinghouse individually. If one of these individual files is less than nine lines long there can be a problem. If this is the case, ticking the “Add 9 line” checkbox will add enough “dummy lines” to the file to be NACHA compliant.
Company Name – Enter your company name or DBA (what ever name your bank knows you by). Total Office Manager may not allow you to use certain characters. Some are not allowed by the direct deposit system.
Bank Name – Enter the name of your bank. This entry does not have to be precise.
Branch – Optional. Enter a description of the branch.
Address – Optional. Enter an address of the bank.
City – Optional. Enter the city of the bank.
State – Optional. Enter the state of the bank.
Zip – Optional. Enter the zip code of the bank.
Default File Name – The default file name of the file that will be sent to your bank. This is the file that contains the direct deposit information. Your bank may not care what the file name is but when you save, Total Office Manager will suggest this name. You can always change it during the save process.
Save – The save button is used to save the information in the form.
Cancel – Exits the form without saving any information.
This topic will cover the use of the Direct Deposit Setup files.
Usage
Use this form to view the various Direct Deposit Setup files that you have created. A Direct Deposit Setup file is the information you need for direct deposit related to Total Office Manager. You can have multiple setup files but most companies will only need one.
IMPORTANT: Direct Deposit is something that you must sign-up for with your bank. You must then setup direct deposit in Total Office Manager.
Form Access
From the main menu, click Banking | Direct Deposit | Company Setup
Field Definitions
List
This form includes a list of all Direct Deposit Setup files that you have created.
Button Definitions
Add New
Allows you to create a new Direct Deposit Setup file. Most companies will need only one.
Edit
Click this button to edit (change) the selected Direct Deposit Setup file.
Delete
Click this button to delete the selected Direct Deposit Setup file. You cannot delete a DD setup file that has been used to process a direct deposit.
Step-By-Step
Select a Direct Deposit Setup file to edit or delete or click the Add New button
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