
Concept explainers
Concept Introduction:
Steps in Accounting cycle:
Accounting cycle is the series of steps of accounting process which processes transactions into financial statements. The steps of accounting cycle are as follows:
- Collecting transactions and events
- Recording
journal entries for transactions and events - Posting the journal entries into ledgers
- Preparing unadjusted
trial balance from ledger balances - Recording
adjusting entries - Posting adjusting entries into ledgers and Preparing adjusted trial balance
- Preparing financial statements; Income statement,
balances sheet , statement of owner's equity andCash flow statements. - Preparing Closing entries to close temporary accounts.
- Preparing post closing trial balance
- Recording reversing journal entries (Optional)
Requirement-a:
To prepare:
The Adjusting entry as on Dec. 31
Concept Introduction:
Steps in Accounting cycle:
Accounting cycle is the series of steps of accounting process which processes transactions into financial statements. The steps of accounting cycle are as follows:
- Collecting transactions and events
- Recording journal entries for transactions and events
- Posting the journal entries into ledgers
- Preparing unadjusted trial balance from ledger balances
- Recording adjusting entries
- Posting adjusting entries into ledgers and Preparing adjusted trial balance
- Preparing financial statements; Income statement, balances sheet, statement of owner's equity and Cash flow statements.
- Preparing Closing entries to close temporary accounts.
- Preparing post closing trial balance
- Recording reversing journal entries (Optional)
Requirement-b:
To prepare:
The Reversing entry as on Jan. 1
Concept Introduction:
Steps in Accounting cycle:
Accounting cycle is the series of steps of accounting process which processes transactions into financial statements. The steps of accounting cycle are as follows:
- Collecting transactions and events
- Recording journal entries for transactions and events
- Posting the journal entries into ledgers
- Preparing unadjusted trial balance from ledger balances
- Recording adjusting entries
- Posting adjusting entries into ledgers and Preparing adjusted trial balance
- Preparing financial statements; Income statement, balances sheet, statement of owner's equity and Cash flow statements.
- Preparing Closing entries to close temporary accounts.
- Preparing post closing trial balance
- Recording reversing journal entries (Optional)
Requirement-c:
To prepare:
The Cash Receipts entry as on Jan. 16

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