How to Use Accounts

How to get the most from Accounts.

Create a New File

To create a new Accounts file, from the File Menu choose "New...". Or, from the startup window choose "Create New File..." (picture below).

Startup Window

Then enter the following information:

  • Choose a default account style. You can select from personal, business or custom styles.
  • Enter your name or the name of your business.
  • Enter the last day of your initial financial year. For example, if your financial year ends on 31 December 200x, you would enter 31 December 200x.
Create a New File Window

What Information Should I Enter?

At a minimum you might want to enter all transactions appearing on your bank or credit card statements. To keep more complete records, you would enter every transaction that affects your personal/business finances.

To keep track of your finances, you will record the income you receive and the expenses you incur. You might also buy assets and make credit card or loan repayments.

Personal/business income (or revenue) includes:
  • Sales Revenue
  • Interest Revenue
  • Dividend Revenue
  • Salary Revenue
  • Wages Revenue
Personal/business expenses include:
  • Rent Expense
  • Utility Expenses
  • Motor Vehicle Expenses
  • Postage Expenses
  • Wage or Salary Expenses (if you are operating a business)
  • Office Stationery Expenses
Assets include:
  • Computer
  • Office Equipment
  • Motor Vehicle
  • Furniture
  • Stock
Liabilities include:
  • Credit card (MasterCard, Visa, AMEX, etc)
  • Loan
  • Accounts Payable
For a full explanation of Assets, Liabilities, Equity, Revenue and Expenses see the Accounts Help section titled "Accounts".

When Should I Enter Information?

Regularly keeping track of your financial information will give you more control over your financial position. If you are keeping records for a business, a few minutes spent each week entering transactions will save you from the huge task of entering all of your data at the end of the financial year. Keeping track of your own financial information can also reduce your end of year accounting and tax costs.

If all your transactions take place through one bank account the simplest way to record your transactions is to enter your information from your bank statements once a month. If you have any transactions that do not go through your bank account, such as petty cash transactions, save the receipts, and also enter those when you enter the information from your bank statements.

To really stay on top of your finances, you could enter transactions as they occur. For example, if you make payments by check, you can enter the payment information into Accounts, and if you use pre-printed checks, Accounts can print the check for you. Similarly, if you have a business, Accounts can produce invoices.

Some transactions, such as bank charges or interest revenue, might only be entered when you receive your bank statement or when you view your bank information online.

Your accountant may also provide you with information that might only be entered at the end of the financial year. For example, this may include amounts to expense for the depreciation of assets.

How to Enter Information

You enter information into Accounts using the "Transaction Entry" window. To open the Transaction Entry window click on the "Transaction" icon in the Accounts toolbar.

Accounts Toolbar

The Transaction Entry window has three tabs for the following journals:
  • Receipts & Sales Jounral
  • Payments & Purchases Journal
  • General Journal
You will enter most transactions into the 'Receipts & Sales' and 'Payments & Purchases' journals.

Sales and Receipts Journal

You use the Receipts & Sales Journal when you receive income. For example, if you are keeping track of your personal finances, you would record your salary or wage income here. If you are keeping track of your business finances you would record your sales transactions here. Similarly, if you received income from selling an asset, you would record the receipt of funds here. Choose the account that the funds are deposited into from the popup button labelled "Debit". The balance of this account will increase by the transaction amount.

You use the Payments & Purchases Journal when you pay expenses, for example, such as a utility bill. Payments also occur when you pay for an expense with a credit card, buy an asset, and when you make a payment to reduce a liability such as a credit card. Choose the account used to pay for the expense from the popup button labelled "Credit". The balance of this account will be reduce by the transaction amount.

The General Journal is the third type of transaction entry journal. Every transaction can be entered as a general journal entry. However, it is usually simpler to use the Receipts & Sales and Payments & Purchases journals for most transactions that involve the payment or receipt of cash or credit. The General Journal is usually used for infrequent or adjusting transactions. For example, you may need to create a provision for bad debts, or enter the yearly depreciation for an asset. At the end of the fiancnail year your accountant may provide you with the journal entries for these types of transactions.

You will find more information about how to enter your financial information in the Help section titled "Transactions".

Opening Balances

When starting a new file or at any time during the initial financial year you can enter an opening balance for any account in the Account Details window. Accounts uses the "Unallocated Opening Balances" account to balance your opening balances if necessary.

Account Window

You can also set the opening balance of an account by entering a General Journal transaction on the first day of your first financial year.

End of Year

When you have finalised all transactions for a past financial year, you will be ready to start the next financial year. To do this, choose "File" then "Start a New Year...". There's no rush to start a new year as transactions relating to future financial years can be entered at any time.

Start a New Year Menu Item

When you choose "Start a New Year..." Accounts will:
  • Transfer the balances of all Revenue and Expense accounts to the Retained Earnings account.
  • The balances of all Asset, Liabilty and Equity accounts will be unaffected.
The Revenue and Expense accounts are closed in order to determine the profit or loss for the year, and to transfer the profit or loss for the closing year to the retained earnings account. Again, there is no rush to "Start a New Year" since you can continue entering transactions for subsequent financial years without starting a new year. However, once you do start a new year, you will no longer be able to enter transactions with dates during the closed year.

New Year Warning Dialog

Last Update - 1 August 2005

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