Accounting Cycle

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 An Accounting cycle is a complete sequence beginning with the recording of the transactions and ending with the preparation of the final accounts.

1) jourlizing: Record the transactions and events in the journal.

2) posting: Transfer the transactions in the respective Accounts opened in the ledger.

3)Balancing: Ascertain the difference between the total of debit amount column and the total of credit amount column of a ledger.

4)Trail Balance: Prepare a list showing the Balance of each and every account to verity whether the sum of the debit balance is equal to the sum of the credit balances.

5) Income Statement: Prepare Trading and profit and loss Account to ascertain the profit or loss for Accounting period.

6) Position Statement (Balance Sheet): prepare the Balance Sheet to ascertain the financial position as at the end of Accounting period.

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