The Accounting Cycle

The Accounting Cycle - six occur at the end of each...

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The Accounting Cycle The accounting cycle begins with the analysis of transactions recorded on source documents such  as invoices and checks; it ends with the completion of a post-closing trial balance. This cycle  consists of the following steps: 1. Analyze and journalize transactions. 2. Post the journal entries to the general ledger accounts. 3. Prepare a trial balance. 4. Journalize and post the adjusting entries. 5. Prepare an adjusted trial balance. 6. Prepare financial statements. 7. Journalize and post the closing entries. 8. Prepare a post-closing trial balance. Steps one and two occur as often as needed during an accounting period. Steps three, four, five, and 
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Unformatted text preview: six occur at the end of each accounting period. Steps seven and eight usually occur only at the end of each fiscal year, but these steps may be completed at the end of each accounting period if the company chooses to do so. If a work sheet is used, steps three, four, and five are initially recorded on the work sheet, which makes it possible to complete step six more quickly, but all adjusting entries on the work sheet must be journalized and posted before closing entries are made....
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This note was uploaded on 11/14/2011 for the course ACCT 1310 taught by Professor Staff during the Fall '10 term at Texas State.

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