Completing The Accounting Cycle
Follow the Steps for success!
The Eight Steps
Analyzing Transactions
Collecting and analyzing data from transactions and events.
Journalize
Recording transactions into the general journal.
Post
Posting entries from the journal into the general ledger.
Prepare a Work Sheet
Look for errors and make corrections called adjustments, which are tracked on a worksheet. Adjustments are also made to account for the depreciation of assets and to adjust for one-time payments that should be allocated on a monthly basis to more accurately match monthly expenses with monthly revenues.
Prepare Financial Statements
Prepare the balance sheet and income statement using the corrected account balances.
Journalize Adjusting and Closing Entries
Post any corrections needed to the affected accounts once your trial balance shows the accounts will be balanced once the adjustments needed are made to the accounts.
Post Adjusting and Closing Entries
Post any corrections needed to the affected accounts once your trial balance shows the accounts will be balanced once the adjustments needed are made to the accounts.
Prepare Post-Closing Trial Balance
To check that closing entries were done correctly so debits equal credits.
Summary of the Steps
Extra Help And Sources!
The Accounting Cycle