In accounting, account titles are the names given to the various categories used to keep track of a businesses finances. For any and every transaction, these accounts are updated to reflect what happened in an organized and consistent manner.
The account titles are found on the business' general ledger, which is a running list of all these transactions. When compiled by an accountant, the general ledger accounts combine to form the company's financial statements.
For example, let's say a business pays cash to buy new inventory from its suppliers. The bookkeeper credits (adds) the inventory account on the general ledger for the cost of that new inventory. That updates the books to show that new inventory has been purchased and is now owned by the company.
Likewise, the accountant will debit (subtract) the same amount from the cash account on the general ledger. That indicates that the company paid for the new inventory with cash, and therefore, the company's cash balance has decreased by the cost of the new inventory.
There are a near endless possibility of account titles used by the millions of business around the world. However, we can consolidate that list to the most common accounts, which are organized below by each's location on the financial statements.
Common Account Titles: Income Statement
Account Title
Type of Account
Sales
Revenue
Cost of Goods Sold
Cost of Goods Sold
Advertising Expense
Operating expense
Amortization Expense
Operating expense
Insurance Expense
Operating expense
Rent Expense
Operating expense
Salaries and Wages
Operating expense
Utilities Expense
Operating expense
Marketing Expense
Operating expense
Gain on sale
Other Income
Interest Income
Other Income
Loss on sale
Other Expense
Interest Expense
Other Expenses
Income Tax
Taxes
Common Account Titles: Balance Sheet
Account Title
Type of Account
Cash
Current Assets
Marketable Securities
Current Assets
Accounts Receivable
Current Asset
Inventory
Current Assets
Prepaid expenses
Current Assets
Allowance for Doubtful Accounts
Current Assets
Buildings
Fixed Assets
Equipment
Fixed Assets
Leasehold Improvements
Fixed Assets
Accumulated Depreciation
Fixed Assets
Land
Fixed Assets
Investment in Bonds
Investments
Investment in Stocks
Investments
Goodwill
Intangible Assets
Intellectual Property
Intangible Assets
Accounts Payable
Current liability
Cash Dividends Payable
Current Liability
Income Tax Payable
Current liability
Capital Stock
Shareholders Equity
Common Stock
Shareholders Equity
Dividends
Shareholders Equity
Paid-In Capital
Shareholders Equity
Preferred Stock
Shareholders Equity
Retained Earnings
Shareholders Equity
Treasury Stock
Shareholders Equity
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