3 Replies Latest reply on Sep 7, 2010 1:49 PM by philmodjunk

    How to develop a chart of account

    saeedsaleh

      Title

      How to develop a chart of account

      Post

      I am new to FM and I am developing a small business accounting database  as an exercise. My question is what is the best way to develop the chart of account and if any one has an example to share.

       

      Regards,

        • 1. Re: How to develop a chart of account
          eibcga

          I'm not sure what you are asking here but I'll give it a try.  I have one of many possible examples out there, and this is by no means the best or only way.

          An account can have many transactions.  But, one transaction can also relate to more than one account (in double-entry bookkeeping).  This is a many-to-many relationship.  One table can be called ACCOUNTS, with columns or fields for Account_No, Account_Name, Account_Type (i.e, Asset, Liability, Equity, Revenue, Expense).  Another table can be TRANSACTIONS, with fields for Transaction_ID, Date, Memo, Name (like the name of a customer, supplier or an employee).  A NAMES table with fields to store the Name_ID, Address, etc.  And a final table, that is, the join table, called TRANSACTION_DETAIL, with columns for Account_ID, Amount (Debit or Credit), etc.  You could then set up the following relationships amongst these tables:

          NAME:name_id::TRANSACTIONS:name_id

          TRANSACTIONS::transaction_id::TRANSACTION_DETAIL::transaction_id

          TRANSACTION_DETAIL:account_id::ACCOUNTS:account_id

          You could name the TRANSACTIONS table "JOURNAL" instead, or TRANSACTION_DETAIL table to "LEDGER", or the NAMES table to be CUSTOMERS, or whatever names that are meaningful to you.

          • 2. Re: How to develop a chart of account
            saeedsaleh

            Thanks Eibcga for your valuable answer.

            I may not explained my self very well. My question is related to how to create a tree of account type view in FM. As you are aware that each account such as assets  has a sub accounts such as fixed assets and running assets and each sub account has another sub accounts until you reach to the last subdivision. This may take up to five sub-levels. My question how I can create this tree of account in FM and relate it to the debt or credit account.

             

            Regards,

            • 3. Re: How to develop a chart of account
              philmodjunk

              You may be able to do this with a summary report of your transactions.

              With such a layout, youcansortthetransactionsto group your records by Account, sub AccountandDebit or Credit with sub-totals for each. The individual transactions can be included or omitted.