The chart of accounts represents the different types of business expenses and income you can expect to encounter in the course of your business. For instance, the opening balance should be your very first entry. You only have to enter this transaction one time when you first start using GnuCash.
The opening balance should reflex the ending balance of your last business checking account statement or the newly deposited amount if you have just opened a new business checking account.
In Gnucash a transaction with only two splits is called a simple transaction., since it only involves the current account and a single chart of account. An example of two splits in the tutorial is with the opening balance transaction of the 500.00, the two splits involved are the checking account and the equity: opening balance.
Every transaction in GnuCash has at least two splits, but a transaction can have more than two splits. A transaction that involves three or more accounts is called a split transaction. The need for 3 or more splits in a transaction occurs when you need to split either the “from” or the “to” account into multiple transaction accounts.