Author: Rob CuppettPosted On: Sep. 30, 2025Last Updated: Sep. 30, 2025
The Chart of Accounts (COA) is the backbone of financial management in Ratals ERP. A Chart of Accounts is a structured list of all accounts your business uses to track assets, liabilities, equity, revenue, and expenses. Properly organizing your transactions into the correct accounts ensures accurate financial reporting, provides a clear view of your business's financial health, and helps your accounting workflows run smoothly.
The screenshot below shows the top-level view of the Chart of Accounts in Ratals ERP. By clicking on the links for Sub Item(s), you can drill down to manage individual accounts within each account type. You'll also notice a number displayed in front of each Sub Item(s). This number shows how many accounts exist under the main account and updates automatically as you add more.
The Notes section includes a key that explains how credits and debits flow for each type of account. These notes serve as a quick reference to help you remember the direction of money movement within each account type. This format makes it simple to understand your account structure at a glance.
Default Chart of Accounts in Ratals ERP
When Ratals ERP is first installed, it includes approximately 80 default accounts that cover most business needs. These default accounts provide a quick-start framework for cash, inventory, payables, equity, revenue, and expenses. You can edit, add, or reorganize these accounts to match your business's unique requirements. Below is a detailed look at the default Chart of Accounts setup in Ratals ERP.
Assets
Current Assets
(1010) Cash / Checking 1111
(1020) PayPal Bank Account
(1030) Cash / Savings
(1040) Accounts Receivables
(1050) Inventory - Product Cost
(1060) Inventory - Shipping Allocation
(1070) Inventory - Ocean Freight Allocation
(1080) Inventory - Inland Haulage Allocation
(1090) Inventory - Customs Clearance Allocation
(1100) Inventory - Duty Allocation
(1110) Inventory - Tariff Allocation
(1120) Inventory - Anti Dumping Allocation
(1130) Inventory - Insurance Allocation
(1140) Inventory - Tax Allocation
(1150) Inventory - Other Allocation
(1160) Inventory Not Yet Paid or Received Asset (Land Cost Estimated - Not Posted)
(2170) Deferred Contra - Discounts (Unearned Revenue)
(2180) Inventory Not Yet Paid or Received Liability
Non-Current Liabilities
(2510) Notes Payable (Long-Term Loan)
(2520) Mortgage Payable
Equity
(Folder) Owner Name Here
(3010) Capital
(3020) Common Stock
(3030) Preferred Stock
(3040) Drawings
(3050) Retained Earnings
(3060) Additional Paid-in Capital (APIC)
(3070) Income Summary
Revenue
(4010) Sales Revenue - Generic
(4020) Sales Revenue - Product
(4030) Sales Revenue - Shipping
(4040) Sales Revenue Returned
(4050) Service Revenue
(4060) Service Revenue Returned
(4070) Other Revenue
(4080) Other Revenue Returned
Expenses
Cost of Goods Sold - COGS
(5010) Cost of Goods Sold - COGS
(5020) Raw Materials
(5030) Direct Labor
(5040) Freight-In - Shipping Goods / Materials
Expenses
(Folder) 123 My Building Address
(6010) Rent Expense
(6020) Utilities Expense
(6030) Office Supplies
(6040) Insurance Expense
(6050) Depreciation Expense
(6060) Salaries and Wages
(6070) Health Insurance Expense
(6080) Auto Insurance Expense
(6090) Advertising & Marketing
(6100) Travel & Meals
(6110) Startup Expenses (Non-Capitalizable)
(6120) Bank Fees
(6130) Merchant Processing Fees
(6140) Rounding Adjustment
These default accounts serve as a starting point. You can edit, add, or reorganize any account to align with your business needs and maintain a well-structured Chart of Accounts.
Chart of Accounts Fields Explained
Each account in your Chart of Accounts has multiple fields that determine how Ratals ERP processes transactions and displays balances in reports. Understanding each field ensures accurate financial reporting and easier ERP account management.
Status: Enable or disable the account using the dropdown.
Account Type: Choose regular or contra accounts for Assets, Liabilities, Equity, Revenue, or Expenses.
Cash Flow Category: Determines how this account will appear in the Cash Flow Statement. Options include:
Cash
Operating
Investing
Financing
Account Class: Account classes control how accounts are included in financial reports. For instance, selecting "None" excludes the account from reports, while "Operating Liability" includes it in the total for Operating Liabilities. Carefully consider the purpose of each account when choosing a class.
None
Checking Bank Account
PayPal Bank Account
Savings Bank Account
Accounts Receivables
Inventory Asset - Product Cost
Inventory Asset - Shipping Allocation
Inventory Asset - Ocean Freight Allocation
Inventory Asset - Inland Haulage Allocation
Inventory Asset - Customs Clearance Allocation
Inventory Asset - Duty Allocation
Inventory Asset - Tariff Allocation
Inventory Asset - Anti-Dumping Allocation
Inventory Asset - Insurance Allocation
Inventory Asset - Tax Allocation
Inventory Asset - Other Allocation
Inventory Not Yet Paid or Received Asset
Inventory Not Yet Paid or Received Liability
Operating Liability
Unearned Product Revenue
Unearned Shipping Revenue
Unearned Service Revenue
Sales Tax Deferred
Deferred Contra - Discounts
Intangible Investment
Capital Contribution
Owner Drawings
Rounding Adjustment
COGS
Variance Clearing Account
Account Number: Enter a unique identifier. Leave empty for folders.
Account Name: Descriptive name for easy identification.
Notes: Optional notes for context or internal guidance.
How to Create New Accounts in Ratals ERP
Follow these steps to create a new account in Ratals ERP:
Drill down to the folder where the account should be located.
If the account is a folder or sub-directory, leave the account number empty. You can place any account type inside any folder, but avoid putting an expense account in an assets folder unless necessary.
Select the correct Account Class and Account Type.
Add notes for guidance or context.
Once all fields are completed, click Save to create the account.
A properly structured Chart of Accounts ensures Ratals ERP provides accurate reporting, streamlined financial workflows, and flexibility for your business needs.
Chart of Accounts FAQ
What is a Chart of Accounts?
A Chart of Accounts (COA) is a structured list of all accounts used by a business to organize financial transactions. It includes accounts for assets, liabilities, equity, revenue, and expenses, providing the foundation for accurate financial reporting in Ratals ERP.
Why is a Chart of Accounts important?
The COA ensures transactions are recorded correctly and consistently, which enables Ratals ERP to generate accurate financial statements, track business performance, and comply with accounting standards.
Can I customize the Chart of Accounts in Ratals ERP?
Yes. Ratals ERP comes with default accounts to get you started, but you can edit, add, or reorganize accounts to match your business's unique structure and financial needs.
What are Account Classes in a Chart of Accounts?
Account Classes determine how accounts are used in financial reports. For example, an account class of "Operating Liability" will be included in operating liability totals, while “None” will exclude the account from reporting.
How do I create a new account in Ratals ERP?
To create a new account, drill down to the appropriate folder, select the correct Account Class and Account Type, fill in the account name and optional notes, and click Save. Folder accounts can have no account number, while individual accounts must have a unique identifier.
Rob Cuppett is the founder and lead engineer behind Ratals, bringing over 20 years of experience in digital marketing, software development, and business automation. He shares expert tutorials, practical guides, and insights to help business owners optimize, customize, and fully leverage software solutions to grow their businesses efficiently.
About Ratals
Rob Cuppett is the visionary founder and lead engineer behind Ratals Inc., the groundbreaking software platform designed to revolutionize how businesses operate.
Rob's journey into the digital world began in 2001, during a time when resources on starting...
