The Best Chart of Accounts for a New Optometry Practice

2026-08-21

Set up a chart of accounts for your new optometry practice with this practical guide, including sample categories, numbering, and setup steps.

Starting an optometry practice means getting your financial house in order from day one. A chart of accounts (COA) is the backbone of your bookkeeping: it organizes every transaction into categories that make your financial statements clear and useful. For a new practice, the best COA is simple, scalable, and tailored to optometry’s unique revenue streams, like exams, glasses, and contact lenses. This guide gives you a concrete structure, realistic numbers, and steps to implement it this week.

Why a Custom COA Matters for Optometry

A generic COA from accounting software often misses optometry-specific categories. Without them, you can’t easily see which part of your practice is profitable: exams, optical sales, or medical services. A well-designed COA lets you track revenue by source, cost of goods sold (COGS) for frames and lenses, and overhead accurately. It also makes tax time easier and helps you apply for loans or sell the practice later. The effort is minimal, but the payoff is clarity.

Core Structure: Numbering and Categories

Use a numbering system to keep accounts organized. Standard ranges:

1000-1999: Assets (cash, accounts receivable, equipment)
2000-2999: Liabilities (loans, accounts payable)
3000-3999: Equity (owner’s contributions, retained earnings)
4000-4999: Revenue (exam fees, optical sales)
5000-5999: Cost of Goods Sold (frames, lenses, contacts)
6000-6999: Operating Expenses (rent, salaries, marketing)

This structure matches most accounting software and makes financial statements intuitive. Keep it simple: start with 30-40 accounts, not 100. You can add sub-accounts later as needed.

Revenue Accounts: Track Every Income Stream

Your revenue accounts should mirror how you actually get paid. For optometry, that means separate accounts for:

Exam Fees: Routine eye exams, comprehensive exams. Expect $80-$150 per exam, depending on your market.
Contact Lens Fitting and Evaluation: Fees for fitting and follow-up. Range $50-$120 per patient.
Optical Sales: Revenue from frames, lenses, and lens coatings. This is often 40-60% of total revenue.
Medical Services: Treatment of eye diseases (e.g., glaucoma, dry eye). Billed to insurance, often $100-$300 per visit.
Retail Products: Non-prescription items like sunglasses, reading glasses, or eye drops. Markup is typically 100-200%.

Separating these lets you see which services drive profit. For example, optical sales often have higher margins than exams, but exams bring in patients.

Cost of Goods Sold (COGS) Accounts

COGS tracks the direct cost of products you sell. For optometry, include:

Frames Inventory: Cost of frames purchased. Average cost per frame: $30-$80 wholesale.
Lenses Inventory: Cost of lenses (including coatings). Wholesale cost: $20-$60 per pair.
Contact Lenses Inventory: Cost of contact lenses sold. Wholesale: $15-$40 per box.
Lab Fees: Charges for lens edging or special orders. Often $10-$30 per job.

Keep COGS separate from operating expenses. This is critical for calculating gross profit, which tells you if you’re pricing correctly.

Operating Expense Accounts: Cover the Essentials

Operating expenses are the day-to-day costs of running the practice. Common accounts and realistic monthly ranges for a new practice:

Account	Typical Monthly Range
Rent	$2,000-$5,000
Salaries and Wages	$5,000-$15,000 (for 2-4 staff)
Payroll Taxes	10-15% of salaries
Marketing and Advertising	$500-$2,000
Insurance (malpractice, property)	$300-$800
Utilities (electric, internet)	$300-$600
Equipment Leases	$200-$500
Software Subscriptions (EHR, billing)	$300-$700
Office Supplies	$100-$300
Professional Fees (accountant, attorney)	$200-$500

These ranges vary by location and size, but they give you a starting point. Track each category separately to spot overspending.

Sample Chart of Accounts for a New Practice

Here’s a practical COA you can adapt. Use these account numbers and names:

1000 Cash
1020 Accounts Receivable
1040 Inventory: Frames
1060 Inventory: Lenses
1080 Inventory: Contacts
1200 Equipment (accumulated depreciation)
2000 Accounts Payable
2100 Loans Payable
3000 Owner’s Equity
3100 Retained Earnings
4000 Revenue: Exam Fees
4010 Revenue: Contact Lens Fitting
4020 Revenue: Optical Sales
4030 Revenue: Medical Services
4040 Revenue: Retail Products
5000 COGS: Frames
5010 COGS: Lenses
5020 COGS: Contacts
5030 COGS: Lab Fees
6000 Rent
6010 Salaries
6020 Payroll Taxes
6030 Marketing
6040 Insurance
6050 Utilities
6060 Equipment Leases
6070 Software Subscriptions
6080 Office Supplies
6090 Professional Fees

This list is not exhaustive, but it covers 90% of your transactions. Add accounts only when you see a recurring need.

How to Set Up Your COA This Week

Follow these steps to get your COA in place:

Choose accounting software: QuickBooks Online or Xero are common. Both allow custom COA. Expect $30-$80/month for a small practice.
Create your accounts: Use the sample above as a template. Enter them into your software’s chart of accounts.
Assign accounts to transactions: When you record income or expenses, always select the correct account. This takes discipline but pays off.
Review monthly: At month-end, run a profit and loss statement. Check that revenue and expenses are in the right categories.
Adjust as needed: If you find a category is too broad, split it. For example, separate marketing into online and print if you spend on both.

Do this before you start booking revenue. It’s much harder to fix later.

Common Mistakes to Avoid

Using too many accounts: Overcomplicating leads to errors. Start lean.
Mixing COGS and expenses: This distorts gross profit. Keep them separate.
Ignoring inventory tracking: If you don’t track inventory, you can’t know your true COGS.
Not reconciling accounts: Reconcile bank and credit card accounts monthly to catch mistakes.

FAQ

Q: Can I use a generic COA from my software? A: Yes, but you’ll need to customize it. Generic COAs often lack optometry-specific revenue and COGS accounts. Start with the sample above and adjust.

Q: How often should I review my COA? A: Review quarterly for the first year. As your practice grows, add accounts as needed. Annual review is a minimum.

Q: Should I hire a bookkeeper to set it up? A: If you’re not comfortable with accounting, a bookkeeper can set up your COA for $200-$500 one-time. It’s worth the investment for accuracy.

Q: What if I already have transactions recorded incorrectly? A: Work with your accountant to reclassify them. It’s fixable, but the sooner you correct it, the easier.

The Bottom Line

A well-structured chart of accounts is essential for a new optometry practice. It gives you clear financial visibility, helps with tax preparation, and supports business decisions. Use the sample COA provided, customize it to your needs, and set it up this week. The time you invest now will save you hours of confusion later and help you build a profitable practice.