Accounting Cycle Paper
This paper will define what an Accounting Cycle is and how it applies to my workplace. There will be some discussion as to what the steps are in the accounting cycle. My workplace’s accounting cycle will be described in detail as well. After reading this paper there should be a better understanding of what the accounting cycle’s main purpose is and the how the accounting cycle is practiced in the day to day transactions of my job.
The accounting cycle can be defined as the series of steps that are completed when recording all financial transactions from journalizing to the final financial statements at the end of the cycle in a business.
The first step is to identify and sum up what transactions are to be recorded and which account should they be recorded in. The second step is to journalize the transactions in the appropriate journals. This then leads to the third step is to post the transactions to the correct account ledgers. From the third step of account ledgers an unadjusted trial balance can be done to check for accuracy of the previous steps. This will bring the company to the fourth step and toward end of the accounting cycle period and the fifth step is to make any adjusting entries can be made at this time to correct transactions or to balance the ledgers. During the sixth step an adjusted trial balance is made to check for the accuracy and balance of all transactions. The seventh step is to prepare all other financial statements aimed at closing out the ledgers. The final step is the eighth step and it is the closing of all accounts to complete the cycle.
Now that the accounting cycle has been defined step by step this paper will clarify how the accounting cycle applies to my current company’s accounting practices. In my workplace that is a church the bills, invoices, and receipts, come through the office. They are then placed in the treasurer’s mailbox for him to pick up when he comes to the church on Wednesday or Sunday...