Seven Digit Chart of Accounts

The seven digit chart of accounts is needed by larger organizations in which management wants to track information about departments within divisions. The seven-digit coding structure requires the coding used for a five-digit system as its baseline, plus two additional digits that are placed to the left of the five-digit codes to designate company divisions. In those cases where a business also wants to track its assets and liabilities by division, it will also be necessary to apply the additional two digits to balance sheet accounts.

The following sample chart of accounts uses divisions located in Boston and Omaha to demonstrate how a seven-digit chart of accounts could be structured.

Account No.	Division	Department	Description
10-00-010	Boston	xxx	Cash
10-00-020	Boston	xxx	Petty cash
10-00-030	Boston	xxx	Accounts receivable
10-00-040	Boston	xxx	Reserve for bad debts
10-00-050	Boston	xxx	Marketable securities
10-00-060	Boston	xxx	Raw materials inventory
10-00-070	Boston	xxx	Work-in-process inventory
10-00-080	Boston	xxx	Finished goods inventory
10-00-090	Boston	xxx	Reserve for obsolete inventory
10-00-100	Boston	xxx	Fixed assets – Computer equipment
10-00-110	Boston	xxx	Fixed assets – Computer software
10-00-120	Boston	xxx	Fixed assets – Furniture and fixtures
10-00-130	Boston	xxx	Fixed assets – Leasehold improvements
10-00-140	Boston	xxx	Fixed assets – Machinery
10-00-150	Boston	xxx	Accumulated depreciation – computer equipment
10-00-160	Boston	xxx	Accumulated depreciation – Computer software
10-00-170	Boston	xxx	Accumulated depreciation – Furniture and fixtures
10-00-180	Boston	xxx	Accumulated depreciation – Leasehold improvements
10-00-190	Boston	xxx	Accumulated depreciation – Machinery
10-00-200	Boston	xxx	Other assets
10-00-300	Boston	xxx	Accounts payable
10-00-310	Boston	xxx	Accrued payroll liability
10-00-320	Boston	xxx	Accrued vacation liability
10-00-330	Boston	xxx	Accrued expenses liability – other
10-00-340	Boston	xxx	Unremitted sales taxes
10-00-350	Boston	xxx	Unremitted pension payments
10-00-360	Boston	xxx	Short-term notes payable
10-00-370	Boston	xxx	Other short-term liabilities
10-00-400	Boston	xxx	Long-term notes payable
10-00-500	Boston	xxx	Capital stock
10-00-510	Boston	xxx	Retained earnings
10-00-600	Boston	xxx	Revenue
10-00-700	Boston	xxx	Cost of goods sold – materials
10-00-710	Boston	xxx	Cost of goods sold – direct labor
10-00-720	Boston	xxx	Cost of goods sold – manufacturing supplies
10-00-730	Boston	xxx	Cost of goods sold – applied overhead
10-10-800	Boston	Engineering	Bank charges
10-10-805	Boston	Engineering	Benefits
10-10-810	Boston	Engineering	Depreciation
10-10-815	Boston	Engineering	Insurance
10-10-825	Boston	Engineering	Office supplies
10-10-830	Boston	Engineering	Salaries and wages
10-10-835	Boston	Engineering	Telephones
10-10-840	Boston	Engineering	Training
10-10-845	Boston	Engineering	Travel and entertainment
10-10-850	Boston	Engineering	Utilities
10-10-855	Boston	Engineering	Other expenses
10-10-860	Boston	Engineering	Interest expense
10-20-800	Boston	Sales	Bank charges
10-20-805	Boston	Sales	Benefits
10-20-810	Boston	Sales	Depreciation
10-20-815	Boston	Sales	Insurance
10-20-825	Boston	Sales	Office supplies
10-20-830	Boston	Sales	Salaries and wages
10-20-835	Boston	Sales	Telephones
10-20-840	Boston	Sales	Training
10-20-845	Boston	Sales	Travel and entertainment
10-20-850	Boston	Sales	Utilities
10-20-855	Boston	Sales	Other expenses
10-20-860	Boston	Sales	Interest expense
10-00-900	Boston	xxx	Extraordinary items
20-00-010	Omaha	xxx	Cash
20-00-020	Omaha	xxx	Petty cash
20-00-030	Omaha	xxx	Accounts receivable
20-00-040	Omaha	xxx	Reserve for bad debts
20-00-050	Omaha	xxx	Marketable securities
20-00-060	Omaha	xxx	Raw materials inventory
20-00-070	Omaha	xxx	Work-in-process inventory
20-00-080	Omaha	xxx	Finished goods inventory
20-00-090	Omaha	xxx	Reserve for obsolete inventory
20-00-100	Omaha	xxx	Fixed assets – Computer equipment
20-00-110	Omaha	xxx	Fixed assets – Computer software
20-00-120	Omaha	xxx	Fixed assets – Furniture and fixtures
20-00-130	Omaha	xxx	Fixed assets – Leasehold improvements
20-00-140	Omaha	xxx	Fixed assets – Machinery
20-00-150	Omaha	xxx	Accumulated depreciation – computer equipment
20-00-160	Omaha	xxx	Accumulated depreciation – Computer software
20-00-170	Omaha	xxx	Accumulated depreciation – Furniture and fixtures
20-00-180	Omaha	xxx	Accumulated depreciation – Leasehold improvements
20-00-190	Omaha	xxx	Accumulated depreciation – Machinery
20-00-200	Omaha	xxx	Other assets
20-00-300	Omaha	xxx	Accounts payable
20-00-310	Omaha	xxx	Accrued payroll liability
20-00-320	Omaha	xxx	Accrued vacation liability
20-00-330	Omaha	xxx	Accrued expenses liability – other
20-00-340	Omaha	xxx	Unremitted sales taxes
<20-00-350 font="">	Omaha	xxx	Unremitted pension payments
20-00-360	Omaha	xxx	Short-term notes payable
20-00-370	Omaha	xxx	Other short-term liabilities
<20-00-400 font="">	Omaha	xxx	Long-term notes payable
20-00-500	Omaha	xxx	Capital stock
20-00-510	Omaha	xxx	Retained earnings
20-00-600	Omaha	xxx	Revenue
20-00-700	Omaha	xxx	Cost of goods sold – materials
20-00-710	Omaha	xxx	Cost of goods sold – direct labor<
20-00-720	Omaha	xxx	Cost of goods sold – manufacturing supplies
20-00-730<	Omaha	xxx	Cost of goods sold – applied overhead
20-10-800	Omaha	Engineering	Engineering -- bank charges
20-10-805	Omaha	Engineering	Engineering -- benefits
20-10-810	Omaha	Engineering	Engineering -- depreciation
20-10-815	Omaha	Engineering	Engineering -- insurance
20-10-825	Omaha	Engineering	Engineering -- office supplies
20-10-830	Omaha	Engineering	Engineering -- salaries and wages
20-10-835	Omaha	Engineering	Engineering -- telephones
20-10-840	Omaha	Engineering	Engineering -- training
20-10-845	Omaha	Engineering	Engineering -- travel and entertainment
20-10-850	Omaha	Engineering	Engineering -- utilities
20-10-855	Omaha	Engineering	Engineering -- other expenses
20-10-860	Omaha	Engineering	Engineering -- interest expense
20-20-800	Omaha	Sales	Sales -- bank charges
20-20-805	Omaha	Sales	Sales -- benefits
20-20-810	Omaha	Sales	Sales -- depreciation
20-20-815	Omaha	Sales	Sales -- insurance
20-20-825	Omaha	Sales	Sales -- office supplies
20-20-830	Omaha	Sales	Sales -- salaries and wages
20-20-835	Omaha	Sales	Sales -- telephones
20-20-840	Omaha	Sales	Sales -- training
20-20-845	Omaha	Sales	Sales -- travel and entertainment
20-20-850	Omaha	Sales	Sales -- utilities
20-20-855	Omaha	Sales	Sales -- other expenses
20-20-860	Omaha	Sales	Sales -- interest expense
20-00-900	Omaha	xxx	Extraordinary items