Xero uses tracking categories and options instead of department codes or cost centers. In Xero, you can only have four tracking categories (two active and two archived categories), and up to 100 tracking options for each tracking category.
Example, two categories were created for the test company - “Location” and “Department” categories. Under each category are category options.
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On the other hand, QuickBooks Online provides categorization of transaction activity with a feature of Locations and Classes in transactions. Location Tracking and Class Tracking lets you track your income and expenses and can be used either one of them individually or both of them together. Class tracking specifies a different class for each detail line of a transaction. Location tracking allows you to assign a location to an entire transaction.
Locations and Classes can be found in Settings > All Lists. 
It should be noted that classes can be used even without locations. But in Xero, options is created under a specific category.
How Conversion Works:
Since Xero and QBO use the feature differently, conversion for files having tracking category and options in Xero is done in journals (given that locations and classes are selected as an additional option). Currently, tracking options are converted under locations and/or classes. Xero can only have two active categories and two archived and so, if there are two active categories, then the options can be under locations and classes.
Dataswitcher’s current system allows matching of the category name according to context, into location and/or classes. For example, if tracking category is country, we put the tracking options under locations. A category name, such as enterprise, will go to classes. The reason for this is that tracking category name in Xero is created by the customer, while in QBO, location and classes by itself are system-default names and cannot be changed.
Locations and classes:
After the latest fix was deployed (Aug. 19, 2022), tracking categories and options in Xero should be migrated to QBO as follows:
In Xero, you can only have four tracking categories (two active and two archived categories); and up to 100 tracking options for each tracking category.
A tracking category in Xero needs at least one tracking option, while locations and classes in QBO can be used together or individually. Currently, “Categories” in Xero are not specifically converted but “Options,” which are under a tracking category, are converted either as locations or classes.