Accounting demands organised thoughts and records. Do you face problems maintaining balance sheets, financial books, and transaction details? Worry no more! Getting accounting assignment help this article narrates the steps of a profound methodology. It is nothing novel but a stepping stone to heal the burden and wipe it away off your shoulders.
Wondering what is it all about? The accounting cycle now runs your business or plans for it with a holistic process. It defines as the method of identifying, analysing and recording the financial information of a business enterprise. So keep your books healthy and organised with a walk of eight counted steps. Scroll to get an insight!
8 Moves of Accounting Cycle to Align Your Financial Books
Monthly, quarterly or annually! They are the calendar markings in a business that sums up, the area of burden, tension and hustle. Thus, leading to misconduct, wrong entries and unorganised details. Are you struggling with the same while drafting an assignment of accounting? If yes! Then as you read, do not forget to pen down the notes, where it takes just eight steps to sort your misery.
Step 1: Begin to Identify and Analyse
Business is all about transactions, and there is no use in bookkeeping without that. So, the first step is to identify all the occurred deals of, buying and selling. It includes the purchase of raw materials, revenue of sales, expenses incurred and the debts paid off. So, keep the records ready and look for the undertakings.
Step 2: Record in Journal Entries
The next step calls for recording the transactions occurred in the journal book. A journal is a detailed account of all the business activities for future reconciliations. The entry must be in chronological order following the basics of accounting, i.e, debit what comes in and credit what goes out. Every detail, must be penned properly in form of calculative figures.
Step 3: Post in General Ledger
The company works on either double-entry or single-entry methods. The general ledger is the base of the company accounts that serve as the master record. It reflects the summary of all financial transactions separately from the individual accounts. It is the account of all the deals, where the sum of debit should match the total credit balance.
Step 4: Calculate Unadjusted Trial Balance
Trial balance is a bookkeeping worksheet that defines two columns - debit and credit. It is curated to balance out the records and make them mathematically correct. It ensures that the entries of debit and credit, should match without any discrepancy. Also, to identify any error if occurred, as it serves as a vital document for audit procedures.
Step 5: Resolve the Worksheets
Now that you have recorded all the transactions of what has been debited or credited. It is time you work on the fifth step of the accounting cycle. Analyse the worksheet and identify the errors to fix them at this stage. The step calls for adjustments and adjusting the accounts of records. Also, it aids in matching the expenses and earnings in the case of accrual accounting.
Step 6: Tune the Journal Entries
Adjusting entries, are made after the term. These are the outcomes of worksheet modifications as well as time-related effects. An adjusted entry, for instance, would include interest income accrued over time. So, the step calls for finding the cause of the shortcoming and giving a quick fix.
Step 7: Curate Financial Statements
Now it is time to create the records of the cash flow statement, balance sheet and income statement. It represents the potential of a business enterprise to repay debts, purchase stock and meet the monthly bills. So, prepare the documents with accurate figures and calculations. As, to understand the present state and take care of future problems.
Step 8: Close the Books
The last step wraps after the quarter an entity uses closing entries to complete temporary accounts, revenues, and costs. The net income gets converted into retained profits as part of these closing entries. The firm prepares the post-closing trial balance to ensure that the debits and credits match and that the cycle may resume.
Now that you are through, with the understanding of the eight steps that define the basis of an accounting cycle, you are all set to curate an assignment for the same. But wait! Didn’t your mind strike with a thought - How will you implement them in your academic assignment? Or, how will you jot down each pointer in a systematic way? The suggestion is not to dwell under the pile of thoughts when you have the option, to avail of online assignment help to eliminate the stress and pass the burden on the shoulders of professionals.
The Wrap
Accounting is a field of, calculations, numbers, transactions, expenses and revenues. All the concepts boggle the mind with several thoughts and ideas. That is why the accounting cycle, was introduced to sort the financial records and systematically present them. All the steps stated in the article are predetermined and must follow in order and in the same sequence every year. It will help with accounting assignments to upgrade your grade from low to high.
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