Hello Nicholas Saunders,

I'll do my best to explain things. Let’s start in the abstract. Assets and Liabilities are determine by account number, not account balance. 2670 is a liability account. Sage 50 knows what type of balance accounts typically have. Assets typically have debit balances and liabilities typically have credit balances. However, this is not always the case. As you've already seen, if you enter opening balances as a negative number, it will flip the balance from what it would normally be. So for 2670 it would be a debit balance instead of a credit balance.

This can happen for a variety of reasons, but in this specific case it is because sales tax is typically refundable. The chart of accounts is typically set up this way because you need to know how much sales tax the business charged on sales and then subtract how much the business was charged on purchases to get a net amount. I'm sure the material you are covering will go into this at some point if it has not already.

Hopefully that helps.

Thanks,
Chris Parrish

Yes, and I completely get that the account number determines the account type.  Where I'm confused is that when I did a general search into this type of account, "HST Paid on Purchases" this shows as one type and yet is listed in the COA as a different type.

It seems to be a double negative, which is fine, I suppose -- but it seems odd.

Although, now my Google search shows that this account would normally be a liability as classified by, here, 2670 for the account number.

Hi Nicholas. By default, accounts starting with 2 are considered a liability (1 for Asset, 3 for Equity, 4 for Revenue, and 5 for Expense).  This could be changed through Setup > Settings > General (Accounts) > Numbering. 

Liabilities when positive would go to Credit and when positive would go to Debit. It also goes the same for Revenue and Equity accounts.