You can assign both an identifying name and ID when you create a category in the Edit Category window. The name and ID should be descriptive and recognizable to you.
Since the ultimate use of categories is to track and analyze the information in Category reports, create your categories with reports in mind. Think about what can you learn by breaking out the information about a separate part of your company or a specific service?
Note: Creating a category automatically turns on the Category Tracking preference
If you had not previously marked the Turn Category Tracking On field in the System view of the Preferences window, it is automatically marked when you create a category. This only occurs if you have single-user access.
Warning: If you delete a category...
All references to the category are removed from the transaction to which it had been assigned. Consider making a backup of your company file before you take this step (Backing up company files) so you have this information still available to you.
Step by step
To create a new category