This document describes how to add an account to the General Ledger Chart of Accounts and how to format it to appear on the Financial Statement and the Supporting Schedule.  For ease in explaining, an expense account (Gasoline Expense – found in the General & Administration – G&A—section of the statements) will be used

 

 

Step l.  Find an Available G/L Number:

The first thing to find is an unused GL account number that can be used.  To get this, print the Account Master File record, go to:

 

• General Ledger (Module 4)
  • ​Account Master (Task 17)
    • ​Print Selected Records (Sub-task 4)
    • The existing G/L accounts will print in account number order.  
    • Expense accounts are normally numbered in the 700-00-01 to 799-00-01 range.  
    • Look in the general area of the expense accounts and try to find accounts that relate to the Gasoline expense, possibly Automobile expense.  Normally there should be a gap in the numbering scheme, as most of the time the expense account numbers are numbered in a pattern, like 721-00-01, 723-00-01, 725-00-01 …try to find an available account number.  Using this scheme with the example, you could use 722-00-01 for the new G/L number.  
    • Make note of the G/L account number decided upon.

 

Step 2.  Assign a Financial Statement Code:

The next thing is to assign a financial statement code to the new G/L number.  This code determines where on the financial statement the amount for the account will be displayed.  Using the example of Gasoline expense, you may want ALL expenses related to Automobiles to be displayed on one line.  In order to determine what this code needs to be, print the G/L in Statement Code order using Task 29 in the G/L module.  Print all accounts, all divisions, ‘Yes’ for group header and totals. “N” to Print ONLY group headers & totals and all statement codes.  

 

Looking at the printout, you should find a G&A section.  Determine where in the G&A section the expense needs to appear.  If a few of the various expense accounts are coded to go into one line item on the financial statement (i.e. all expenses related to the Automobile, including Gasoline expenses), the statement code should be the same on all of the related expense accounts.  Make note of the statement code number, along with the G/L account number and description.  Using the example, the G&A section of the printout might look like this:

 

                                                                        G/L Acct #       Statement Code

GENERAL & ADMIN                                                            P300GH

AUTOMOBILE EXPENSE                             983-00-HH      P302IP           

Auto payment expense                                      721-00-01       P302VS          

Auto repair expense                                          723-00-01       P302VS          

Using this scheme, if Gasoline Expense will appear with Auto Payment Expense and Auto Repair Expense on the Financial Statement as one line titled:  AUTOMOBILE EXPENSE, use the same statement code – P302VS

 

Note: If the G/L account being added is not going to appear with other related G/L accounts on a single line on the Income Statement, another new G/L account must be added to make the new expense account appear on the statement on a line by itself and would look somewhat like this:

GENERAL & ADMIN                                                            P300GH

AUTOMOBILE EXPENSE                             983-00-HH      P302IP           

Auto payment expense                                      721-00-01       P302VS          

Auto repair expense                                          723-00-01       P302VS          

GASOLINE EXPENSE                                 984-00-HH      P305IP           

Gasoline expense                                           724-00-01        P305VS

• If this is the way you would like the new account to appear (by itself, not grouped with other G/L accounts) look once again at the print-out and look for Header/IP G/L account numbers (using the example, see the G/L account # for AUTOMOBILE EXPENSE with the Statement Code: P302IP).   Header/IP accounts are usually found in the 900 series of G/L numbers.  Try to fit the new G/L Account number with the IP account near that account, again using the example:  GASOLINE EXPENSE has the code P305IP. 
• P stands for Profit & Loss statement accounts. B stands for Balance Sheet statement accounts. (being the example is for an account on the Profits/Loss – Income Statement, the statement code begins with a P)
• The number after the P or B is the order it will appear on the statement.
• IP/Header accounts appear on the financial statements, but don’t actually have dollar amounts posted to them, the dollar amounts are posted to accounts ending in VS
• VS accounts MUST have an IP account with the same number, so they will appear on the financial statements (i.e. P302IP & P302VS).

 

Coded as above, the GASOLINE EXPENSE (P305IP) account figure would appear after the AUTOMOBILE EXPENSE (P302IP) on the Income Statement.

Make note of the Statement Code selected.

 

 

 

Step 3.  Assign a Supporting Schedule Code:

Next, a Supporting Schedule code needs to be assigned to the G/L number. In order to determine what this code needs to be, print the G/L in Schedule Code order using Task 28 in the G/L module.  Print all accounts, all divisions, and ‘Yes’ for group header and totals.  

 

Look for the G & A accounts, and find the place in the list where the new account should appear and look for the accounts before and after that spot.  The printout should look something like this:

                                                            G/L Acct. #      State. Code      Schedule Code

 

GENERAL &  ADMIN                                               P300GH          3100GH

AUTOMOBILE EXPENSE                 983-00-HH      P302IP            4000GH

Auto payment expense                          721-00-01       P302VS           4001VP

Auto repair expense                              723-00-01       P302VS           4003VP

 

To make the new G/L account for Gasoline Expense appear, for example, between the Auto Payment Expense and Auto Repair Expense accounts, you would use the schedule code 4002VP.

Make note of the Supporting Schedule Code selected.

 

 

 

Step 4.  Creating the G/L Account Number:

Now the account number, description, Financial Statement code and Supporting Schedule code have been decided.  Go to:

• General Ledger (Module 4)
  • ​Account Master (Task 17)
    • ​Enter New G/L Account# Record (Sub-task 1) 

When entering the expense VS account use D (for Debit) in Paren Ctl (field 05) , for Indent (field 08) use 2, and leave fields 06 and 07 blank.  Also use D for Debit for Asset accounts on the Balance Sheet.

When entering the expense header IP account use D (for Debit) in Paren Ctl, for indent use 1, and leave fields 06 & 07 blank.

Of course if this was an income account being added, the Paren Ctl would be C for Credit along with Liability/Owner’s Equity accounts on the Balance Sheet.

 

Here is how the entries for the example should look: 

*01. Account #            984-00-HH

 02. Acct descry           GASOLINE EXPENSE

 03. Fin St. code           P302IP

 04. Support Schd       

 05. Paren Ctl               D

 06. Contra-act  :

 07. Wrk Cap Code:

 08. Indent #                 1   How many digits to indent description on forms.

 

*01. Account #            722-00-01

 02. Acct descry           Gasoline Expense

 03. Fin St. code           P302VS

 04. Support Schd        4002VP

 05. Paren Ctl               D

 06. Contra-act  :

 07. Wrk Cap Code:

 08. Indent #                 2   How many digits to indent description on forms.

 

 

 

Step 5.  Verify:

The General Ledger accounts can be printed by Financial Statement code (using Task 29) and Supporting Schedule code (using Task 28) so the accuracy can be verified.