Categories are used for internal processing. For example, you can use categories as automatic offset accounts for cash transactions or line items, such as sales tax or freight. Categories are used when calculating invoices or payments.
Use the Chart of Accounts>Category List screen available from the Setup menu to review existing categories linked to accounts, or to add or edit categories linked to accounts.
To create or edit categories linked to accounts:
Go to the Chart of Accounts>Category List screen.
To add a new category, click the add icon on the action bar. Select the Category from the drop-down list. Then, select the account to which the category should be linked from the Account drop-down list and save your selections.
To edit or delete a category in the list, click anywhere in the row of the category, then make the necessary edits, or click Delete.