Accounting Cycle Process 

The accounting cycle is a collective process of identifying, analysing, and recording the accounting events of a company. It is a standard 9-steps process that begins when a transaction occurs and ends with its inclusion in the financial statements.

In this cource accounting cycle process explained with example in step wise and each and every step start from step 1 to Step 9 given example related to it.

Steps 1 - Collecting & Analysing the documents

An organization begins its accounting process with the identification of the transactions (collecting and analysing the documents) that comprise a bookkeeping event. As our example this could be a start process with starting service, or payment related services and so on.

Step 2 – Posting in Journal Entries

Next step is recording of transactions using journal entries. The entries are based on the receipt of an invoice related to services, recognition of a services, or completion of other events like payment of salaries for employee. We pass journal entries using double entry system in which debit and credit balance remains equal. This process is repeated throughout the accounting period.

Step 3  - Posting in Ledger Accounts

Step 4- Preparation of Trail Balance (Unadjusted)

Step 5 - Posting of Adjustment Entries

Step 6- Adjusted Trail Balance

Step 7- Preparation of Financial Statement

Step 8- Post closing Entries

Step 9- Post-Closing Trial Balance