Weygandt (2008) stated that accounting cycle includes the avocation steps: analyzing and journalizing business transactions, lineup to ledger accounts, preparing a trial balance, journalizing and post adjusting entries, preparing an adjusted trial balance and financial statements, journalizing and posting closing entries, and finally preparing a post-closing trial balance. The adjusted trial balance is prepared by putting together the adjustments with the unadapted balances for to each one account. The totals of the adjusted trial balance columns confirm the equating credits = debits.
One of the steps in the accounting cycle is to classify adjusted trial balance amounts to financial statements. During this step account balances from the adjusted trial balance will be placed into their proper financial statement columns. For instance, expenses will go to the income statement debit column; conversely revenues will go in the income statement credit one.
Once this step is completed, each financial statement columns will be totaled.
By missing a step, while completing the accounting cycle, will seeming lead to mistakes in the financial statements. However, a worksheet is an exceptional turncock when preparing financial information. A work sheet offers some(prenominal) advantages such(prenominal) as helps preparing the financial statements, decrease the chances of committing mistakes while working with several accounts and adjustments, shows the effects what if transactions, and several other advantages (Larson, Wild, & Chiappetta, 2005).
References:
Larson, K., Wild, J., and Chiappetta, B. (2005). Fundamental accounting principles...If you exigency to get a full essay, order it on our website: Orderessay
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