The accounting cycle.

Question

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Answer 1

Question

Chapter 4, Problem 4.1Q

To determine

To describe: The accounting cycle.

Expert Solution & Answer

Explanation of Solution

Accounting cycle:

The accounting cycle refers to the process of recording and summarizing the financial events of a business. It operates in the form of a cycle, with the steps of accounting activities followed in a cyclical order. The cyclical order starts at the beginning of a transaction, until the time when financial results are derived subsequent to the preparation of the final accounts at the end of the accounting year.

There are nine steps involved in the accounting cycle. They are discussed as follows.

Step 1: It involves indentifying whether an economic activity has occurred or not. Once an economic activity has been identified, it is required to be recorded in the books of accounts.
Step 2: It involves passing the journal entries for transaction identified as economic events in the first stage.
Step 3: It involves posting the journal entries by transferring the journal entries to the general ledger.
Step 4: It involves preparing the unadjusted trial balance after all balances have been closed.
Step 5: It involves preparing the adjusting entries so as to determine the effect of the cutoff date for the purpose of closing a financial period. It helps ensure that all economic activities have been recorded.
Step 6: It involves preparing the adjusted trial balance after considering the effect of adjusting entries.
Step 7: It involves preparing the income statement, balance sheet, and the statement of cash flows.
Step 8: It involves closing the temporary accounts, such as revenue, expenses, and dividend account.
Step 9: It involves post-closing the trial balance. A trial balance is prepared after the closing of entries.

Conclusion

Hence, the accounting cycle is discussed as above.

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Answer 2

Question

Chapter 4, Problem 4.1Q

To determine

To describe: The accounting cycle.

Expert Solution & Answer

Explanation of Solution

Accounting cycle:

The accounting cycle refers to the process of recording and summarizing the financial events of a business. It operates in the form of a cycle, with the steps of accounting activities followed in a cyclical order. The cyclical order starts at the beginning of a transaction, until the time when financial results are derived subsequent to the preparation of the final accounts at the end of the accounting year.

There are nine steps involved in the accounting cycle. They are discussed as follows.

Step 1: It involves indentifying whether an economic activity has occurred or not. Once an economic activity has been identified, it is required to be recorded in the books of accounts.
Step 2: It involves passing the journal entries for transaction identified as economic events in the first stage.
Step 3: It involves posting the journal entries by transferring the journal entries to the general ledger.
Step 4: It involves preparing the unadjusted trial balance after all balances have been closed.
Step 5: It involves preparing the adjusting entries so as to determine the effect of the cutoff date for the purpose of closing a financial period. It helps ensure that all economic activities have been recorded.
Step 6: It involves preparing the adjusted trial balance after considering the effect of adjusting entries.
Step 7: It involves preparing the income statement, balance sheet, and the statement of cash flows.
Step 8: It involves closing the temporary accounts, such as revenue, expenses, and dividend account.
Step 9: It involves post-closing the trial balance. A trial balance is prepared after the closing of entries.

Conclusion

Hence, the accounting cycle is discussed as above.

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Answer 3

Question

Chapter 4, Problem 4.1Q

To determine

To describe: The accounting cycle.

Expert Solution & Answer

Explanation of Solution

Accounting cycle:

The accounting cycle refers to the process of recording and summarizing the financial events of a business. It operates in the form of a cycle, with the steps of accounting activities followed in a cyclical order. The cyclical order starts at the beginning of a transaction, until the time when financial results are derived subsequent to the preparation of the final accounts at the end of the accounting year.

There are nine steps involved in the accounting cycle. They are discussed as follows.

Step 1: It involves indentifying whether an economic activity has occurred or not. Once an economic activity has been identified, it is required to be recorded in the books of accounts.
Step 2: It involves passing the journal entries for transaction identified as economic events in the first stage.
Step 3: It involves posting the journal entries by transferring the journal entries to the general ledger.
Step 4: It involves preparing the unadjusted trial balance after all balances have been closed.
Step 5: It involves preparing the adjusting entries so as to determine the effect of the cutoff date for the purpose of closing a financial period. It helps ensure that all economic activities have been recorded.
Step 6: It involves preparing the adjusted trial balance after considering the effect of adjusting entries.
Step 7: It involves preparing the income statement, balance sheet, and the statement of cash flows.
Step 8: It involves closing the temporary accounts, such as revenue, expenses, and dividend account.
Step 9: It involves post-closing the trial balance. A trial balance is prepared after the closing of entries.

Conclusion

Hence, the accounting cycle is discussed as above.

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Answer 4

Question

Chapter 4, Problem 4.1Q

To determine

To describe: The accounting cycle.

Expert Solution & Answer

Explanation of Solution

Accounting cycle:

The accounting cycle refers to the process of recording and summarizing the financial events of a business. It operates in the form of a cycle, with the steps of accounting activities followed in a cyclical order. The cyclical order starts at the beginning of a transaction, until the time when financial results are derived subsequent to the preparation of the final accounts at the end of the accounting year.

There are nine steps involved in the accounting cycle. They are discussed as follows.

Step 1: It involves indentifying whether an economic activity has occurred or not. Once an economic activity has been identified, it is required to be recorded in the books of accounts.
Step 2: It involves passing the journal entries for transaction identified as economic events in the first stage.
Step 3: It involves posting the journal entries by transferring the journal entries to the general ledger.
Step 4: It involves preparing the unadjusted trial balance after all balances have been closed.
Step 5: It involves preparing the adjusting entries so as to determine the effect of the cutoff date for the purpose of closing a financial period. It helps ensure that all economic activities have been recorded.
Step 6: It involves preparing the adjusted trial balance after considering the effect of adjusting entries.
Step 7: It involves preparing the income statement, balance sheet, and the statement of cash flows.
Step 8: It involves closing the temporary accounts, such as revenue, expenses, and dividend account.
Step 9: It involves post-closing the trial balance. A trial balance is prepared after the closing of entries.

Conclusion

Hence, the accounting cycle is discussed as above.

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Answer 5

Chapter 4, Problem 4.1Q

To determine

To describe: The accounting cycle.

Expert Solution & Answer

Explanation of Solution

Accounting cycle:

The accounting cycle refers to the process of recording and summarizing the financial events of a business. It operates in the form of a cycle, with the steps of accounting activities followed in a cyclical order. The cyclical order starts at the beginning of a transaction, until the time when financial results are derived subsequent to the preparation of the final accounts at the end of the accounting year.

There are nine steps involved in the accounting cycle. They are discussed as follows.

Step 1: It involves indentifying whether an economic activity has occurred or not. Once an economic activity has been identified, it is required to be recorded in the books of accounts.
Step 2: It involves passing the journal entries for transaction identified as economic events in the first stage.
Step 3: It involves posting the journal entries by transferring the journal entries to the general ledger.
Step 4: It involves preparing the unadjusted trial balance after all balances have been closed.
Step 5: It involves preparing the adjusting entries so as to determine the effect of the cutoff date for the purpose of closing a financial period. It helps ensure that all economic activities have been recorded.
Step 6: It involves preparing the adjusted trial balance after considering the effect of adjusting entries.
Step 7: It involves preparing the income statement, balance sheet, and the statement of cash flows.
Step 8: It involves closing the temporary accounts, such as revenue, expenses, and dividend account.
Step 9: It involves post-closing the trial balance. A trial balance is prepared after the closing of entries.

Conclusion

Hence, the accounting cycle is discussed as above.

Answer 6

Chapter 4, Problem 4.1Q

To determine

To describe: The accounting cycle.

Expert Solution & Answer

Explanation of Solution

Accounting cycle:

The accounting cycle refers to the process of recording and summarizing the financial events of a business. It operates in the form of a cycle, with the steps of accounting activities followed in a cyclical order. The cyclical order starts at the beginning of a transaction, until the time when financial results are derived subsequent to the preparation of the final accounts at the end of the accounting year.

There are nine steps involved in the accounting cycle. They are discussed as follows.

Step 1: It involves indentifying whether an economic activity has occurred or not. Once an economic activity has been identified, it is required to be recorded in the books of accounts.
Step 2: It involves passing the journal entries for transaction identified as economic events in the first stage.
Step 3: It involves posting the journal entries by transferring the journal entries to the general ledger.
Step 4: It involves preparing the unadjusted trial balance after all balances have been closed.
Step 5: It involves preparing the adjusting entries so as to determine the effect of the cutoff date for the purpose of closing a financial period. It helps ensure that all economic activities have been recorded.
Step 6: It involves preparing the adjusted trial balance after considering the effect of adjusting entries.
Step 7: It involves preparing the income statement, balance sheet, and the statement of cash flows.
Step 8: It involves closing the temporary accounts, such as revenue, expenses, and dividend account.
Step 9: It involves post-closing the trial balance. A trial balance is prepared after the closing of entries.

Conclusion

Hence, the accounting cycle is discussed as above.

Answer 7

Chapter 4, Problem 4.1Q

To determine

To describe: The accounting cycle.

Answer 8

Expert Solution & Answer

Explanation of Solution

Accounting cycle:

The accounting cycle refers to the process of recording and summarizing the financial events of a business. It operates in the form of a cycle, with the steps of accounting activities followed in a cyclical order. The cyclical order starts at the beginning of a transaction, until the time when financial results are derived subsequent to the preparation of the final accounts at the end of the accounting year.

There are nine steps involved in the accounting cycle. They are discussed as follows.

Step 1: It involves indentifying whether an economic activity has occurred or not. Once an economic activity has been identified, it is required to be recorded in the books of accounts.
Step 2: It involves passing the journal entries for transaction identified as economic events in the first stage.
Step 3: It involves posting the journal entries by transferring the journal entries to the general ledger.
Step 4: It involves preparing the unadjusted trial balance after all balances have been closed.
Step 5: It involves preparing the adjusting entries so as to determine the effect of the cutoff date for the purpose of closing a financial period. It helps ensure that all economic activities have been recorded.
Step 6: It involves preparing the adjusted trial balance after considering the effect of adjusting entries.
Step 7: It involves preparing the income statement, balance sheet, and the statement of cash flows.
Step 8: It involves closing the temporary accounts, such as revenue, expenses, and dividend account.
Step 9: It involves post-closing the trial balance. A trial balance is prepared after the closing of entries.