There are two main types of accounts:
An account that tracks what your company is spending. (You can think of expenses as money that leaves the company.) Unlike balance sheet accounts, expense accounts do not have a register of their own. You can get a list of the transactions posted to an expense account by selecting the account in the chart of accounts and choosing QuickReport from the Action pop-up menu (
).
An account that tracks the source of your company's income. (You can think of income as money that comes into the company.) Unlike balance sheet accounts, income accounts do not have a register of their own. You can get a list of the transactions posted to an income account by selecting the account in the chart of accounts and choosing QuickReport from the Action pop-up menu (
).
A report that summarizes the financial position of a business. A balance sheet shows the value of your company's assets, liabilities, and equity as of a particular day. It is called a balance sheet because the value of the assets is always exactly equal to the combined value of the liabilities and equity.
Your company assets are the things that your company owns.
QuickBooks distinguishes between two types of assets:
Income and expense accounts track the sources of your income and the purpose of each expense. When you record transactions in one of your balance sheet accounts, you usually assign the amount of the transaction to one or more income or expense accounts. For example, not only do you record that you took money out of your checking account, but you keep track of what you spent the money on: utilities, office supplies, etc.
To display a balance for income and expense accounts, choose Reports > Company & Financial > Profit & Loss, or select the income or expense account in the chart of accounts and then choose QuickReport from the Action pop-up menu (
).