The ledger contains, as we have already explained, all the company's accounts. These accounts must be arranged in a way that makes it easier for the accountant to identify them when carrying over the financial transactions to them and when preparing the financial statments, and with the existence of accounting programs it has become necessary for the accountant to learn how to make a chart of accounts or what is known as the accounts tree.
Chart of accounts is a statement containing the names and numbers of accounts that determine their location in the ledger, one of the methods used in preparing this chart is that the accounts are divided into five groups (assets, liabilities, owner's equity, revenue and expenses) so that such each of these groups and the sub-accounts are numbered to serial numbers. The numbering method varies from company to another; this is one of the methods that can be used in preparing the chart of accounts.
| Account No. | Account Name |
|---|---|
| 1 | Assets |
| 11 | Current Assets |
| 111 | Cash |
| 112 | Bank |
| 113 | Account receivables (Debtors) |
| 1131 | Name of the first debit |
| 1132 | Name of the second debit |
| 1133 | Name of the third debit |
| 1134 | Name of the fourth debit |
| 1135 | Name of the fifth debit |
| 114 | Notes receivable |
| 115 | Inventory |
| 116 | Accrued revenue |
| 117 | Prepaid expenses |
| 12 | Fixed assets |
| 121 | Lands |
| 122 | Buildings |
| 123 | Vehicles |
| 124 | Furniture |
| 125 | Computers |
| 13 | Intangible assets |
| 131 | Trademark |
| 132 | Patent |
| 133 | Goodwill |
| Account No. | Account Name |
|---|---|
| 2 | Liabilities |
| 21 | Current liabilities |
| 211 | Account payables (Creditors) |
| 2111 | Name of the first credit |
| 2112 | Name of the second credit |
| 2113 | Name of the third credit |
| 2114 | Name of the fourth credit |
| 2115 | Name of the fifth credit |
| 212 | Notes payable |
| 213 | Short-term loans |
| 214 | Deferred (unearned) revenue |
| 215 | Accrued expenses |
| 22 | Non-current liabilities |
| 221 | Long-term loans |
| Account No. | Account Name |
|---|---|
| 3 | Owner's Equity |
| 31 | Capital |
| 32 | Owner's Withdrawals |
| 33 | Current of the company's owner |
| 34 | Reserve account |
| 35 | Retained profits |
| Account No. | Account Name |
|---|---|
| 4 | Revenue |
| 41 | Sales revenue |
| 411 | Sales |
| 412 | Sales returns |
| 413 | Sales allowance |
| 42 | Other revenue |
| 421 | Investment revenue |
| 422 | Lease revenue |
| Account No. | Account Name |
|---|---|
| 5 | Expenses |
| 51 | Cost of sales |
| 511 | Purchases |
| 512 | Purchases expenses |
| 513 | Purchases returns |
| 514 | purchases allowance |
| 52 | Selling and marketing expenses |
| 521 | Sales expenses |
| 522 | Selling commissions |
| 523 | Advertising |
| 53 | Administrative and general expenses |
| 531 | Salaries and wages |
| 532 | Rent |
| 533 | Electricity |
| 534 | Telephone and internet |
| 535 | Maintenance |
| 536 | Governmental expenses |
| 537 | Water |