Account title definition
/What is an Account Title?
An account title is the unique name assigned to an account in an accounting system. An account title is essential when the accounting staff needs to identify an account, since the title conveys the purpose of the account. The other unique identifier, the numeric account code, may incorporate some identification logic, but is much more difficult to associate with a specific account. Without an account title, the possibility of making an incorrect entry into the wrong account would be much higher.
Some common account titles are as follows:
Assets
Cash
Accounts receivable
Marketable securities
Prepaid expenses
Fixed assets
Other assets
Liabilities:
Accounts payable
Accrued expenses
Taxes payable
Short-term loans
Long-term loans
Equity:
Common stock
Preferred stock
Additional paid-in capital
Treasury stock
Revenues:
Goods revenue
Services revenue
Interest income
Expenses:
Cost of goods sold
Compensation expense
Payroll tax expense
Rent expense
Office supplies expense
Depreciation expense
Interest expense
Account Title Best Practices
A best practice is to periodically review all account titles, to ensure that they accurately reflect the types of transactions being recorded within the associated accounts.