About classes

Why use classes?

Classes provide a system for categorizing transactions that goes beyond the basic ways of assigning transactions to expense or income accounts.

With classes, you can categorize each detail line on a transaction. This lets you write one checkto the office supply store for things bought for two different business units and still track the business unit for those purchases.

For example, suppose you have a consulting business and an installation business. Class tracking is ideal for you if it is typical to have purchases and sales that include both types of work. By specifying the appropriate class on each detail line, you can run a Profit and loss by class report that will tell you if your consulting business is more or less profitable than the installation business.

Note that you can also use departments like classes. What's the difference between class and department tracking?

If you want to track activity associated with projects, use sub-customers instead. How?

You should specify a class only if the transaction (or part of the transaction) needs to be classified.

For example, a general contractor might use classes to track residential and commercial projects:

• If office equipment was purchased that was used for all types of projects, the contractor would leave Class unspecified on the purchase transaction.
• If building materials were purchased for a home remodel, the contractor would assign the class for tracking residential projects on the purchase transaction.

Examples of classes

Examples of how people use classes are:

• Departments
• Enterprises
• Properties
• Construction industry standard categories (General, Site Work, Concrete, Masonry, and so on)
• Manufacturers
• Partners
• Product lines

For example, a farmer might create a class for each enterprise: "Corn," "Hogs," and "Soybeans." At the end of an accounting period, the farmer could create reports for each farm enterprise.

How to use classes

To use classes:

1. Turn on class tracking (in Company Settings or Account and Settings depending on what you see).
2. Add classes that are meaningful to your business.
3. When you enter invoices, checks, credit card charges, or other transactions, assign a class to the transaction (or detail lines of the transaction), if it makes sense.
4. Create reports by class.