Creation of Chart of Account

The chart of accounts is a listing of all accounts used in the general ledger of an organization. The chart is used by the accounting software to aggregate information into an entity's financial statements. The chart is usually sorted in order by account number, to ease the task of locating specific accounts.

A numbering system is used in a chart of accounts to make organization and recordkeeping easier. Here is an example of what a chart of accounts for a very small business may look like