The Simple 8 Steps to Accounting

The Description on the Accounting Cycle

Big image

Step 1: Analyzing your Transactions

Assets always equals Liabilities + Owner's Equity so T-Charts are good idea to help keep your Information Accurate and Organized.

Step 2: Journalizing

After Figuring out all you Info and getting it Organized you need to Record your Transactions into the General Journal.

Step 3: Posting

When done completing Journalizing it's time to Post. There are 5 steps to posting. The link below goes more in depth in the description of posting:


https://www.youtube.com/watch?v=QkgF1-6aOwQ

Step 4: Preparing a Work Sheet

The Work Sheet mostly summarizes the General Journal and also shows the Adjustments made during a specific Fiscal Period.

Step 5: Preparing Financial Statements

Financial Statements show your Assets, Liabilities, and Owner's Equity. The Document makes sure that the Accounting Equation still is in Balance, Assets=Liabilities+ Owner's Equity.

Step 6: Journalizing Adjusting and Closing Entries

After the given Fiscal Period, the non-permanent records are closed. Here is a website that goes more in depth : http://www.accountingtools.com/closing-entries

Step 7: Posting Adjusting and Closing Entries

After Closing the Entries you need to Post the General Journal.

Step 8: Prepare Post-Closing Trial Balance

After all the numbers are posted it is time to prepare your Post-Closing Trial Balance, which tells you your assets for the next fiscal period. Here is an example on how to prepare a Post-Closing Trial Balance:

http://www.myaccountingcourse.com/accounting-cycle/post-closing-trial-balance

Conclusion:

Thank you for learning about the Accounting Cycle with me today !