It’s actually what the word means! The ‘Default’ category simply implies that there are no categories in that account and hence the ‘Default’ category is selected automatically whenever you categorize a transaction with this account.

For example, as a business, you sell phones and laptops. In your Chart of Accounts, under Income, there's an account called Sales. You can add ‘phone’ and ‘laptop’ as sub-accounts (sub-categories) to Sales. 

Now, when you create an invoice, you can mark its category with Sales > Phone. This way your invoice is auto-categorizing relevant debit and credit accounts. 

However, if you don't add the phone and laptop accounts, your invoice can be categorized under Sales > Default. This way your categorization is managed even if you haven't added a sub-account under Sales.

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