- Current Assets: Current Asset accounts are accounts that represent assets that are expected to be converted to cash within one year or one operating cycle, whichever is longer. These accounts are important for businesses to manage their short-term liquidity and cash flow.
- Cash and Cash Equivalents: This account represents cash on hand, bank deposits, and other highly liquid investments that can be easily converted into cash.
- Accounts Receivable: This account represents money owed to the business by customers for goods or services that have been sold but not yet paid for.
- Inventory: This account represents the cost of goods that a business has on hand and is available for sale.
- Prepaid Expenses: This account represents expenses that have been paid in advance, such as rent or insurance.
- Other Current Assets: This account represents any other current assets that do not fit into the above categories, such as short-term investments or advances to employees.
- Property, Plant, and Equipment: Property, Plant, and Equipment (PP&E) accounts are used to track the acquisition, depreciation, and disposal of tangible assets that a company owns and uses to generate revenue over a longer period of time. These assets are typically used in the production or delivery of goods and services, and are not intended for resale.
- Buildings: This account represents the cost of buildings owned by the company, including the land, construction, and improvements.
- Machinery and Equipment: This account represents the cost of machinery, equipment, and other fixed assets used in production, such as computers, furniture, and vehicles.
- Leasehold Improvements: This account represents the cost of improvements made to leased properties, such as remodelling or renovations.
- Land: This account represents the cost of land owned by the company, including any improvements made to the land.
- Accumulated Depreciation: This account represents the total amount of depreciation taken on fixed assets, which reduces the value of the assets over time.
- Disposal of PP&E: This account represents the gain or loss on the sale or disposal of fixed assets, which is calculated as the difference between the sales price and the carrying value of the asset.
Proper management of PP&E accounts is essential for accurate financial reporting and decision making. Companies need to keep track of the acquisition, depreciation, and disposal of these assets, and regularly review the accounts to ensure that they are accurate and up to date. By monitoring these accounts, companies can make informed decisions about capital investments, depreciation schedules, and asset sales.
- Current Liabilities: The Current Liabilities account type is a standard account type that is used to track short-term obligations that are due within one year or within the normal operating cycle of a business. This account type is classified under the “Liabilities and Equities” account group in the NetSuite Chart of Accounts.
The Current Liabilities account type is used to track obligations that are expected to be settled within a relatively short period of time, such as accounts payable, accrued expenses, short-term loans, and other similar liabilities. These obligations are generally due within the next 12 months or within the normal operating cycle of the business.- Accounts Payable: This account tracks the amount owed to suppliers for goods and services purchased on credit.
- Accrued Expenses: This account is used to record expenses that have been incurred but not yet paid, such as salaries, taxes, and interest.
- Deferred Revenue: This account tracks the amount of revenue received in advance for goods or services that have not yet been delivered or earned.
- Customer Deposits: This account tracks the amount of money received from customers in advance of providing goods or services.
- Sales Tax Payable: This account is used to track the amount of sales tax owed to tax authorities.
- Unearned Revenue: This account tracks revenue that has been received but has not yet been earned, such as prepayments for subscriptions or services.
- Short-term Loans: This account tracks loans that are expected to be repaid within the next year.
- Current Portion of Long-term Debt: This account tracks the portion of long-term debt that is due within the next year.
- Other Current Liabilities: This account is used to track any other current liabilities that do not fall under the above categories, such as accrued interest or warranties payable.
- Long-term Liabilities: The Long-term Liabilities account type is a standard account type that is used to track obligations that are due beyond the next 12 months or beyond the normal operating cycle of a business. This account type is classified under the “Liabilities and Equities” account group in the NetSuite Chart of Accounts.
The Long-term Liabilities account type is used to track obligations that are expected to be settled over an extended period of time, such as long-term loans, deferred tax liabilities, pension obligations, and other similar liabilities. These obligations are generally due beyond the next 12 months or beyond the normal operating cycle of the business.- Long-term Debt: This account tracks the total amount of debt that is expected to be repaid over a period of more than one year.
- Capital Lease Obligations: This account tracks the amount of money owed for leased assets that the company is required to purchase at the end of the lease term.
- Pension Liabilities: This account tracks the amount of money that the company owes to its employees for their pension plans.
- Deferred Tax Liabilities: This account is used to track the amount of taxes that will be owed in the future due to temporary differences between book and tax accounting.
- Other Long-term Liabilities: This account is used to track any other long-term liabilities that do not fall under the above categories, such as long-term warranties or deferred compensation.
These accounts are important for evaluating a company’s long-term financial stability and help in making decisions about the business. They are also crucial in calculating financial ratios that investors and creditors use to assess a company’s creditworthiness and financial strength.
- Stockholders’ Equity: Stockholders’ Equity is a standard account type that represents the residual interest in the assets of a business after deducting its liabilities. This account type is classified under the “Liabilities and Equities” account group in the NetSuite Chart of Accounts.
Stockholders’ Equity is made up of various accounts that reflect the contributions of the owners or shareholders of a business, such as common stock, preferred stock, additional paid-in capital, retained earnings, and accumulated other comprehensive income. These accounts represent the portion of a company’s assets that belong to its owners or shareholders.- Common Stock: This account tracks the par value of the common stock issued by the company.
- Additional Paid-in Capital: This account tracks the amount of money received from shareholders for stock that exceeds the par value.
- Retained Earnings: This account tracks the portion of the company’s profits that have been retained and reinvested into the business.
- Accumulated Other Comprehensive Income: This account tracks unrealized gains or losses on certain investments or foreign currency translations.
- Treasury Stock: This account tracks the number of shares of the company’s stock that have been repurchased and are held by the company.
- Non-controlling Interest: This account tracks the portion of a subsidiary’s equity that is not owned by the parent company.
These accounts are important for evaluating a company’s financial health and help in making decisions about the business. They are also crucial in calculating financial ratios that investors and creditors use to assess a company’s creditworthiness and financial strength.
- Operating Revenues: Operating Revenues is a standard account type that is used to track the income generated from the primary operations of a business. This account type is classified under the “Income” account group in the NetSuite Chart of Accounts.
Operating Revenues are revenues that are generated from the sale of goods or services that are directly related to a company’s core business operations. These revenues are typically recurring and are generated on an ongoing basis. Examples of Operating Revenues in NetSuite may include sales revenue, service revenue, and subscription revenue.- Sales Revenue: This account tracks revenue generated from the sale of goods or services.
- Service Revenue: This account tracks revenue generated from services provided to customers, such as consulting or maintenance services.
- Subscription Revenue: This account tracks revenue generated from recurring subscriptions, such as software-as-a-service (SaaS) or subscription-based services.
- Rental Revenue: This account tracks revenue generated from the rental of equipment or property.
- Commission Revenue: This account tracks revenue generated from commissions earned on sales made by the company or its employees.
- Royalty Revenue: This account tracks revenue generated from the use of the company’s intellectual property, such as patents or copyrights.
- Interest Income: This account tracks revenue generated from interest earned on investments or loans.
- Other Operating Revenue: This account is used to track any other operating revenue that does not fall under the above categories, such as gain on sale of assets or recoveries from bad debts.
These accounts are important for evaluating a company’s revenue streams and help in making decisions about the business. They are also crucial in calculating financial ratios that investors and creditors use to assess a company’s revenue growth and profitability.
- Cost of Goods Sold: Cost of Goods Sold (COGS) accounts are a specific type of account used to track the direct costs associated with producing and selling goods. COGS accounts are classified under the “Cost of Sales” account group in the NetSuite Chart of Accounts and are used in conjunction with Inventory asset accounts to track the movement and cost of inventory items.
COGS accounts in NetSuite can be created to track different types of costs, depending on the nature of the goods being sold and the accounting method used by the business. Some common types of COGS accounts in NetSuite include:- Direct Material Cost: This COGS account is used to track the cost of raw materials used to manufacture goods.
- Direct Labor Cost: This COGS account is used to track the cost of labor used to manufacture goods.
- Manufacturing Overhead Cost: This COGS account is used to track indirect costs, such as rent, utilities, and depreciation, that are associated with the manufacturing process.
- Purchased Items Cost: This COGS account is used to track the cost of items that are purchased for resale.
When transactions are recorded in NetSuite, the system will automatically debit the appropriate COGS account when goods are sold, and credit the Inventory asset account to reflect the reduction in inventory. This allows businesses to easily track their direct costs of goods sold and calculate their gross profit margins.
- Marketing Expenses: Marketing Expenses accounts are a specific type of account used to track the costs associated with marketing activities. Marketing expenses accounts are classified under the “Operating Expenses” account group in the NetSuite Chart of Accounts and are used to track the various costs associated with advertising, promotions, and other marketing activities.
Marketing Expenses accounts in NetSuite can be created to track different types of costs, depending on the nature of the marketing activities being undertaken and the accounting method used by the business. Some common types of Marketing Expenses accounts in NetSuite include:- Advertising Costs: This account is used to track the cost of advertising, such as print ads, TV commercials, and online ads.
- Promotions and Events Costs: This account is used to track the cost of promotional activities and events, such as sponsorships, trade shows, and giveaways.
- Public Relations Costs: This account is used to track the cost of public relations activities, such as media relations and press releases.
- Marketing Research Costs: This account is used to track the cost of marketing research activities, such as surveys and focus groups.
When transactions are recorded in NetSuite, the system will automatically debit the appropriate Marketing Expenses account when marketing costs are incurred, allowing businesses to easily track their marketing expenditures and monitor their marketing ROI.
- Payroll Dept. Expenses: Payroll Department Expenses accounts are a specific type of account used to track the costs associated with the payroll department of a business. These expenses are classified under the “Operating Expenses” account group in the NetSuite Chart of Accounts and are used to track various costs associated with managing and processing payroll for employees.
Payroll Department Expenses accounts in NetSuite can be created to track different types of costs, depending on the nature of the payroll activities being undertaken and the accounting method used by the business. Some common types of Payroll Department Expenses accounts in NetSuite include:- Salary and Wages: This account is used to track the cost of salaries and wages paid to employees.
- Payroll Taxes: This account is used to track the cost of payroll taxes paid by the business, such as Social Security, Medicare, and unemployment taxes.
- Employee Benefits: This account is used to track the cost of employee benefits, such as health insurance, retirement plans, and vacation pay.
- Payroll Processing Fees: This account is used to track the cost of using payroll processing services, such as ADP or Paychex.
When transactions are recorded in NetSuite, the system will automatically debit the appropriate Payroll Department Expenses account when payroll costs are incurred, allowing businesses to easily track their payroll expenditures and monitor their payroll-related expenses.