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Accounting Cycle

Accounting Cycle

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Published by Devendrasinh Rajput

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Published by: Devendrasinh Rajput on Sep 17, 2012
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05/13/2014

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Accounting Cycle: 1. Recording Cycle 2. Classification 3.

Summarizing

Recording
Also called Books of Original Entry:

Classification
 General Ledger used to classify different transactions into “Accounts” E.g. Suppliers Ledger Customers Ledger G/L provides classified information about different types of transactions and helps in preparing Financial Statements

Summarizing  P/L and Balance
sheet is prepared on the basis of General Ledger

1. Journal (Main book of Original Entry) 2. Purchase Book 3. Sales Book 4. Cash Book 5. Purchase Return Book 6. Sales Return Book 7. Bills Payable Book 8. Bills Receivable Book

  

 All transactions
are summarized … 1. Assets 2. Liabilities 3. Earnings 4. Earnings 5. Expenses  Not every transaction is actual transaction,E.g. Depreciation

Verification:
Trial Balance is used to check correctness of the Ledger Accounts; it should be tallied

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