Understanding Money accounts

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My Money 2.0 Manual | Using the account register<<Previous | Next>>Editing, hiding and deleting accounts



To help organize all of your finances in one place, My Money allows you to set up accounts for banks, brokerage, and credit cards as well as non-monetary items like homes, vehicles, and employee stock options. Each Money account represents either something you own (an asset) or something you owe (a liability), and lets you track the money—or value—that is added to or subtracted from that account.

My Money is flexible enough to let you track as few or as many accounts as you’d like,depending on how complete you want your financial records to be. This way, you can track the fluctuating values of items you possess as well as your standard financial assets.

My Money toolbar includes the Account Tab icon, which gives you one-click access to your account list from anywhere in My Money.


Tracking your Accounts

My Money uses a combination of Account types and Account Categories to track your financial records

My Money has 8 built-in Account types:

  • Standard Checking Account
  • Standard Savings Account
  • Money Market Account
  • Line Of Credit
  • Cash Management Account
  • Credit Card Account
  • Investment Account
  • Loan Account

Accounts could be further grouped into one of the following categories:

  • Asset Accounts
  • Liability Accounts
  • Equity Accounts
  • Income Accounts
  • Cost Of Goods Sold (COGS) Accounts
  • Expense Accounts
  • Other Income
  • Other Expense

Small Business Accounts

Different types of businesses will have different accounts. For example, to report the cost of goods sold a manufacturing business will have accounts for its various manufacturing costs whereas a retailer will have accounts for the purchase of its stock merchandise. Many industry associations publish recommended charts of accounts for their respective industries in order to establish a consistent standard of comparison among firms in their industry. Accounting software packages often come with a selection of predefined account charts for various types of businesses.

There is a trade-off between simplicity and the ability to make historical comparisons. Initially keeping the number of accounts to a minimum has the advantage of making the accounting system simple. Starting with a small number of accounts, as certain accounts acquired significant balances they would be split into smaller, more specific accounts. However, following this strategy makes it more difficult to generate consistent historical comparisons. For example, if the accounting system is set up with a miscellaneous expense account that later is broken into more detailed accounts, it then would be difficult to compare those detailed expenses with past expenses of the same type. In this respect, there is an advantage in organizing the chart of accounts with a higher initial level of detail.

Some accounts must be included due to tax reporting requirements. For example, in the U.S. the IRS requires that travel, entertainment, advertising, and several other expenses be tracked in individual accounts. One should check the appropriate tax regulations and generate a complete list of such required accounts.

Other accounts should be set up according to vendor. If the business has more than one checking account, for example, the chart of accounts might include an account for each of them.

Chart of Accounts

The chart of accounts is a listing of all the accounts in the general ledger, each account accompanied by a reference number. To set up a chart of accounts, one first needs to define the various accounts to be used by the business. Each account should have a number to identify it. For very small businesses, three digits may suffice for the account number, though more digits are highly desirable in order to allow for new accounts to be added as the business grows. With more digits, new accounts can be added while maintaining the logical order. Complex businesses may have thousands of accounts and require longer account reference numbers. It is worthwhile to put thought into assigning the account numbers in a logical way, and to follow any specific industry standards. An example of how the digits might be coded is shown in this list:

1000 - 1999: asset accounts
2000 - 2999: liability accounts
3000 - 3999: equity accounts
4000 - 4999: revenue accounts
5000 - 5999: cost of goods sold
6000 - 6999: expense accounts
7000 - 7999: other revenue (for example, interest income)
8000 - 8999: other expense (for example, income taxes)

Account Order

Balance sheet accounts tend to follow a standard that lists the most liquid assets first. Revenue and expense accounts tend to follow the standard of first listing the items most closely related to the operations of the business. For example, sales would be listed before non-operating income. In some cases, part or all of the expense accounts simply are listed in alphabetical order.

Setting Up My Money Accounts

To add a new Account please select File-New-New Account Menu. In the following dialog please enter as much information as you have about the new account.


Once account is created it will appear in the Chart of Accounts view


Cash Accounts

If you typically keep emergency cash or traveler’s checks around the house, you should enter this as an investment, so that it appears in your net worth and as cash assets.

When you withdraw cash from any bank account to store in your home, simply record the transaction as a transfer to your Emergency Cash account. Money automatically classifies this as a cash deposit into the emergency cash account.

My Money 2.0 Manual | Using the account register<<Previous | Next>>Editing, hiding and deleting accounts

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