Account type and detail types in QuickBooks Online

Understand the difference between account types and detail types to accurately categorize transactions in your chart of accounts.

Overview

The chart of accounts is the foundation of your company's accounting. When you create a new account, you must select an account type and a detail type.

• Account types: Determine how QuickBooks tracks money and which financial reports (Balance Sheet or Profit & Loss) display the account data.
• Detail types: Help you categorize accounts more specifically within an account type but do not affect the accounting behavior.

Note: If you need help managing your chart of accounts, you can partner with a QuickBooks Live Expert.

Account types

The account type is the most critical selection because it dictates how QuickBooks classifies your data for financial reporting.

• Balance Sheet accounts: These track what you own and what you owe.
  • Examples: Accounts payable, Accounts receivable, Assets, Liabilities, Equity, Bank accounts, Credit cards.
    • Note: Accounts with an opening balance feed into the Balance Sheet.
• Profit & Loss accounts: These track money coming in and going out.
  • Examples: Income, Expenses, and Cost of Goods Sold.

Detail types

Detail types provide a secondary layer of categorization to help you keep your chart of accounts organized.

• Purpose: They act as sub-categories to clarify what specific kind of transaction an account tracks (for example, distinguishing between "Advertising" and "Office Supplies" under Expenses).
• Impact: Detail types do not affect the accounting or which report the data appears on. They are primarily for your own organization and clarity.
• Selection: When you select an account type, QuickBooks provides a list of relevant detail types. Each option includes a description to help you choose the best match.

Choose the right types

Follow this process when creating a new account to ensure accuracy.

• Select the Account Type: Choose the category that best fits the financial nature of the account (for example, Income, Expense, Bank). This ensures the data flows to the correct report.
• Select the Detail Type: Choose the specific description that matches the transactions you want to track.
  • If you cannot find an exact match, select the closest option.
  • Read the description provided for each detail type to confirm it fits your needs.