What Does Accounting Cycle Mean?
The name given to the collective process of recording and processing the accounting events of a company. The series of steps begin when a transaction occurs and end with its inclusion in the financial statements. The nine steps of the accounting cycle are: • Collecting and analyzing data from transactions and events. • Putting transactions into the general journal. • Posting entries to the general ledger. • Preparing an unadjusted trial balance. • Adjusting entries appropriately. • Preparing an adjusted trial balance. • Organizing the accounts into the financial statements. • Closing the books. • Preparing a post-closing trial balance to check the accounts. Also known as “bookkeeping cycle”.
