These are the accounts that you will use to keep track of your expenses. Each separate category of expense should have its own account. Many of the types of accounts are dictated by the types of expenses which should be itemized for tax purposes. You will generally have separate accounts for advertising costs, utility expenses, rent, phone costs, etc. One or more separate accounts should also be set up to keep track of inventory expenses. These should be kept separate from other expense accounts as they must be itemized for tax purposes.
Please analyze your business and determine which accounts would be best suited to select for your particular situation. You will then number these accounts, as you did the income accounts. The categories presented are general categories that match most Internal Revenue Service tax forms. You may, of course, set up separate accounts that are not listed to suit your particular needs. Try not to set up too many accounts or you will have a hard time trying to remember all of them. Also note that you may add or delete accounts as you need them. If you delete an account, however, you must shift any transactions that you have recorded in that account to a new account.
