Chart of Accounts for Photographers
What is a Chart of Accounts?
The chart of accounts a system for categorizing all of a company’s financial accounts. A chart of accounts is usually divided into five categories: assets, liabilities, equity, income, and expenses.
Why do photographers need a Chart of Accounts?
The categories on the chart of accounts feed directly into the financial statements, such as the profit and loss, as well as the balance sheet. A well-developed chart of accounts ensures that your financial reports are not only accurate but easy for you to read and understand. Your financial reports will provide you with the necessary information to make informed business decisions today, and in the future.
How should I organize my chart of accounts?
The good news is that accounting software, such as QuickBooks, will provide you with a basic chart of accounts that you can edit to fit the needs of your business. Keep your chart of accounts as simple and only include accounts that you need to meet reporting requirements. For photographers, below is a simple, yet inclusive, template to follow when creating your chart of accounts. NOTE: Account numbers are optional.
Assets
Asset accounts include anything that the business owns that has value, like a building, land, equipment, vehicles, and inventory.
1010 Checking
1020 Savings
1030 PayPal
1040 Accounts Receivable
1050 Inventory
1060 Property
1070 Equipment
Liabilities
Liabilities accounts include loans, mortgages, payroll taxes due, and any bills that the business has not paid.
2010 Accounts Payable
2020 Sales Tax Payable
2030 Payroll Tax Payable
2040 Mortgage Loan
2050 Other Loans
Equity
3010 Owner’s Contributions
3020 Retained Earnings
Income
4010 Sales – Products (albums, prints, etc)
4020 Sales – Services
4030 Affiliate Income
Cost of Goods Sold
5010 Materials and Supplies (cost of albums, prints, etc)
5020 Labor Costs (directly related to sales made)
Expenses
6010 Advertising
6020 Travel Expenses
6030 Contract Labor
6040 Office Supplies
6050 Studio Rent
6060 Gear/Equipment Rentals
6070 Meals and Entertainment
6080 Wages paid to employees
6090 Dues and Subscriptions
6100 Education
6110 Props & Backdrops
Once you have developed your chart of accounts, take the time to review it as your business grows and changes.