Steps in Accounting cycle: Accounting cycle is the series of steps of accounting process which processes transactions into financial statements. The steps of accounting cycle are as follows: Collecting transactions and events. Recording journal entries for transactions and events. Posting the journal entries into ledgers. Preparing unadjusted trial balance from ledger balances. Recording adjusting entries. Posting adjusting entries into ledgers and Preparing adjusted trial balance. Preparing financial statements; Income statement, balances sheet, statement of owner’s equity and Cash flow statements. Preparing Closing entries to close temporary accounts. Preparing post closing trial balance. Recording reversing journal entries (Optional). To Indicate: The correct order given steps of accounting cycle.

BuyFind

Cornerstones of Financial Accounti...

4th Edition
Jay Rich + 1 other
Publisher: Cengage Learning
ISBN: 9781337690881
BuyFind

Cornerstones of Financial Accounti...

4th Edition
Jay Rich + 1 other
Publisher: Cengage Learning
ISBN: 9781337690881

Solutions

Chapter 3, Problem 37BE
To determine

Concept Introduction:

Steps in Accounting cycle: Accounting cycle is the series of steps of accounting process which processes transactions into financial statements. The steps of accounting cycle are as follows:

  1. Collecting transactions and events.
  2. Recording journal entries for transactions and events.
  3. Posting the journal entries into ledgers.
  4. Preparing unadjusted trial balance from ledger balances.
  5. Recording adjusting entries.
  6. Posting adjusting entries into ledgers and Preparing adjusted trial balance.
  7. Preparing financial statements; Income statement, balances sheet, statement of owner’s equity and Cash flow statements.
  8. Preparing Closing entries to close temporary accounts.
  9. Preparing post closing trial balance.
  10. Recording reversing journal entries (Optional).

To Indicate:

The correct order given steps of accounting cycle.

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