The
accounting cycle is a serial series of activities to determine and record an
entity's individual transactions, that aggregative at the end of period into
money statements. The accounting cycle is basically the core redecoration
activity that an accounting department engages in progress basis, and forms the
premise for the money statements. Most accounting controls and procedures
relate to the accounting cycle.
The
following discussion breaks the accounting cycle into the treatment of
individual transactions, so closing the books at the top of the accounting
amount.
The
accounting cycle for individual transactions is:
1. Identify
the events of accounting dealing. Examples of such events are:
Buy
materials
Pay
wages to workers
Apply
overhead to inventory and also the value of goods sold
Sell
merchandise to customers
Provide
services to customers