Summary of the Accounting Cycle

Summary of the Accounting Cycle - reversing entry at the...

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Summary of the Accounting Cycle Illustration 4-33 shows the required steps in the accounting cycle. You can see that the cycle begins with the analysis of business transactions and ends with the preparation of a post-closing trial balance. Companies perform the steps in the cycle in sequence and repeat them in each accounting period. Illustration 4-33 Required steps in the accounting cycle
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Helpful Hint Some companies prefer to reverse certain adjusting entries at the beginning of a new accounting period. The company makes a
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Unformatted text preview: reversing entry at the beginning of the next accounting period; this entry is the exact opposite of the adjusting entry made in the previous period. Steps 13 may occur daily during the accounting period, as explained in Chapter 3 . Companies perform Steps 47 on a periodic basis, such as monthly, quarterly, or annually. Steps 8 and 9, closing entries and a post-closing trial balance, usually take place only at the end of a company's annual accounting period....
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Summary of the Accounting Cycle - reversing entry at the...

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