Accounting cycle refers to the specific tasks involved in completing an accounting process. The length of an accounting cycle can be monthly, quarterly, semi annually and annually. It may vary from organization to organization but the process remain the same.
The step involve in accounting cycle include:
- Collecting and analyzing accounting document.
- Posting in journal;
- Posting in ledger account;
- Preparation of trial balance;
- Posting of adjustment entries;
- Adjusted trial balance;
- Preparation of financial statements;
- Post closing entries;
- Post closing trial balance.