TYPES OF

ACCOUNTS
ACCOUNTING LESSON
 OBJECTIVES

1. Discuss the five major accounts

2. Cite examples of each type of accounts

3. Prepare Chart of Accounts

 5 MAJOR TYPES OF ACCOUNTS
1. CASH
2. LIABILITIES
3. OWNER’S EQUITY
4. INCOME
5. EXPENSES
ASSETS
Are things of value
owned by the business
and recorded in terms of
their monetary value.
ACCOUNTS UNDER ASSETS:

CASH
Currency on
hand and
money in
banks under
the name of
the company
 ACCOUNTS UNDER ASSETS:
ACCOUNTS
RECEIVABLE
Amounts or claims
from clients or
customers resulting
from services
rendered by the
company or by sale
of merchandise.
 ACCOUNTS UNDER ASSETS:

LAND
Ground area
used in
operation of the
business
 ACCOUNTS UNDER ASSETS:

BUILDING
Structure used
or occupied by
the business
 ACCOUNTS UNDER ASSETS:

OFFICE
EQUIPMENT
Equipment for
office use such
as typewriters,
calculators,
and computers
 ACCOUNTS UNDER ASSETS:

FURNITURE
AND FIXTURE
Cabinets,
tables, Chairs,
and light
fixtures in the
building.
Is it feels good when you OWN
many things?
Agree or Disagree
LIABILITIES
Are debts or financial
obligations of the
business which usually
must be paid on a specific
date.
 ACCOUNTS UNDER LIABILITIES:

ACCOUNTS
PAYABLE
Amounts owed
to creditors for
purchase of
goods or
services
received
 ACCOUNTS UNDER LIABILITIES:

TAXES
PAYABLE
Amounts due
to the
government
like sales taxes
and income
taxes.
 ACCOUNTS UNDER LIABILITIES:

RENT
PAYABLE
Rent already
used but not
have been
paid
 Ever been in this situation
before?
If yes, then you suffer from
LIABILITIES…
OWNER’S EQUITY
These refer to the
owner’s interest in the
business which consists of
the invested capital and
results of operations
whether gain or loss.
ACCOUNTS UNDER OWNER’S EQUITY:

Owner’s
Name, Capital
Amounts of
contributions
of the owner
to the business
 ACCOUNTS UNDER OWNER’S EQUITY:

Owner’s Name, Drawing

Amounts
withdrawn by
the owner
from the assets
of the business
for personal
use
INCOME
Are the different services
rendered to customers
over a given accounting
period.
 ACCOUNTS UNDER INCOME:
SERVICE
INCOME/
SERVICE FEES
Refers to
services
rendered to
customer
EXPENSES
Are the different cost
rendered for the
different use of a certain
services offered to the
business.
 ACCOUNTS UNDER EXPENSES:

SALARIES
EXPENSE
Refer to
compensation or
remunerations in
whatever form
to employees
 ACCOUNTS UNDER EXPENSES:

ADVERTISING
EXPENSE

Cost to promote
certain services
and product of
the business
 ACCOUNTS UNDER EXPENSES:

UTILITIES
EXPENSE
Refers to the
cost of electricity
and water used
in the ordinary
course of
business
 ACCOUNTS UNDER EXPENSES:

TAXES
EXPENSES
Refers to
taxes and
licenses due
to the
government.
 ACCOUNTS UNDER EXPENSES:
OFFICE
SUPPLIES
EXPENSE
To consider
if supplies
has been
used up
Point to Remember:
DON’T MEMORIZE!
You will frustrate yourself…
On the process of learning;
you would get to know other
accounts and use them later
CHART OF ACCOUNTS
A listing of all the
accounts and their
account numbers in the
ledger.
 Chart of Accounts
Balance Sheet Accounts Income Statement Accounts
Assets Income
110 Cash 410 Service Income/Service Fees
120 Accounts Receivable
150 Land Expenses:
160 Building 510 Salaries & Wages
170 Equipment 520 Advertising Expense
180 Furniture and Fixture 530 Utilities Expense
Liabilities 540 Taxes Expense
210 Accounts Payable 550 Office Supplies Expense
220 Taxes Payable
230 Rent Payable
Owner’s Equity
310 Owner’s Name, Capital
320 Owner’s Name, Drawings
330 Income Summary
THANK YOU
 EVALUATION
TEST I
Instruction: For each account, indicate whether it is asset (A),
liabilities (L), owner’s equity (OE), income (I) or expense (E)
account on the space provided.
 
1. Accounts Payable _______
2. Cash _______
3. Salaries & Wages _______
4. Dela Cruz, Drawings _______
5. Service Fees _______
TEST II
Instruction: Rearrange the following accounts
in their proper order by placing the number
on the space provided.
 
1. Accounts Payable _______
2. Cash _______
3. Salaries & Wages _______
4. Dela Cruz, Drawings _______
5. Service Fees _______