Keep your accounting system organized by assigning an account number ✨

Keep your accounting system organized by assigning an account number ✨

In a general journal, there will be channel 3 that is the box that records the account numbers of various accounts, where the account numbers are determined according to the account category, which can be divided into 5 categories as follows:

- Asset Category Code 1

- Liabilities Code 2

- Owner's equity category, code 3

- Income category, code 4

- Expense category, code 5

So if it's an asset class account The account number will start with 1 if it is a liability account. The account number will start with 2 if it is an owner's equity account. The account number starts with 3 if it is a revenue category account. The account number will start with the number 4 and if it is an expense category account The account number will start with the number 5.

👉 How many digits does the account number have?

How many digits the account number will have depends on the size of the business. If it's a small business, it may have a two-digit account number. But if it's a large business, it may have three or more account numbers.

👉🏻What is the second digit for each category?

Each category of the second digit of the account number is assigned differently as follows:

- The second digit asset category is arranged in descending order of asset liquidity.

- The second digit of the Liabilities category is the same as the Asset category, namely the liquidity of the liabilities.

- The owner's equity category of the second digit number is arranged from the first and the latter of the list.

- The second digit income category and expense category can be sorted and the most frequent expenses, the less recurring income and expenses.

👉🏻 Example of account number assignment

cash 101

Land 131

Creditor 201

Master's Scholarship 301

Income from production costs 401