New chart of accounts & how to manage categories for your invoice products

Your Chart of Accounts is where you'll go to organize your accounting and ensure that your business is accurately represented within Wave. If you use our Invoicing tools, you may find the Income tab to be particularly important.

You’ll find that our upgrade has brought lots of exciting new changes to your Chart of Accounts page. As before, found under the Accounting tab in the left navigation menu.

The updates to your Chart of Accounts include:

  • The addition of new account types
  • A simplified account creation process
  • More clarity around the information required
  • The ability to add account numbers or identifiers to accounts you create
  • New tabbed browsing, so you can move around more easily

Adding Income Accounts

If Wave is primarily an invoicing tool for you, then most of your time on the Chart of Accounts page will be spent in the Income tab. From here, you’ll be able to add new accounts to be associated with the products and services you include on your invoices.

To add a new income account:

  1. Click on Add a New Account at the top of the page
  2. Select Income from the Account Type menu
  3. Name the account
  4. Add an Account ID and Description if needed
  5. Click Save.

The new account will now appear in the Income tab of your Chart of Accounts

Once you’ve added an income account, you can now link it to products and services in two ways: invoice creation, or product & services creation. Keep reading for details.

To create a new product that is linked to this income account, head over to the Sales tab, and select Products & Services. Complete the following:

  1. Click on Add a Product or Service (or click the grey pencil icon if the product or service already exists)
  2. Fill out all necessary fields, and select Sell This
  3. Select your newly-created income account from the drop-down menu that appears
  4. Click Save

You can also add an account to any products and services that don’t already have one associated with them directly from the invoices that you create. Just add the item to your invoice and select Edit Income Account under the item name.

You now have a product or service that is associated with a specific income account. Any time this product is added to a Wave invoice, the income associated with it will appear to contribute to the account’s balance in your reporting. Any products and services that are not connected to a custom income account will be recorded to your Sales account by default.

Adding Discounts

Income accounts have other uses too! For example, you may sometimes wish to issue a discount on an invoice for a regular customer.

We hear you. In order to facilitate this, we’ve added a new account type: Discounts. Any time you introduce a new discount or promotion, you’ll want to add a new discount account so that you are able to track the total amount that has been withheld from your invoice sales.

The new Discounts account-type is what is known as a contra-revenue account. This means that its balance will be negative and will count against the balances of the rest of your other income accounts.

To add a new discount account:

  1. Click on Add a New Account at the top of the page
  2. Select Discount from the Account Type menu
  3. Name the account
  4. Add an Account ID and Description as needed
  5. Click Save

Whenever adding a discount to your invoices as an item, be sure to make the price of the item negative (enter “-” before the value). This will subtract the discount from the invoice total.

Any discount accounts that have been added and associated with products and services will appear as their own line item in your reports. If you have followed the above directions, your discount account’s balance should have a negative value.

That’s it! Now that you’ve mastered adding new income accounts and associating them with the products and services that you sell, you can track your sales with as much specificity as you please!