What are the Steps in a Balance Sheet Accounting Cycle?
Everyday Accounting Transactions The nine steps of an accounting cycle are divided into two parts. The first four steps are followed throughout the accounting cycle. The last five steps create results for the cycle after each transaction is compiled, adjusted, and reviewed. Each step represents a necessary part of the cycle. The cycle begins with an invoice, payroll report, work order, canceled check,or other source document that denotes an accounting transaction. The source document must have a date, description, name and amount of the charge. Next is the analysis of the transaction. Decide what accounts in the Chart of Accounts (the list of all revenue and expense accounts) are affected by the transaction. The third step is to journal the account and whether they will be debited or credited and by how much. Journals must be posted in consecutive order by date and by type. Journals of sales, expenses, and other categories created by the accountant is called the Journal of Accounts. Po
