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completing the accounting cycle

Published on Dec 17, 2015

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1.

completing the accounting cycle

mr. melkonian
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2.

the adjustment process

we have to keep numbers accurate and up to date
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3.

accountants must ensure

  • all accounts are up to date
  • all late transactions are taken into account
  • all calculations have been made correcty
  • all GAAPs have been complied with
4.

Bringing account data up-to-date is known as 'making the adjustments'

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5.

adjusting entry

assigns amounts of revenue or expense to the appropriate accounting period
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6.

adjusting entries for supplies

supply account has to be adusted at the end of each accounting period
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7.

This has to happen since the supply account is allowed to become inexact between statements.

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8.

when you buy supplies

their cost is debited
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9.

as supplies are used

no entries are made to record usage at the time
10.

sample adjustment

11.

adjusting for prepaid expenses

sometimes expenses are paid for in advance, but benefits extend into future
12.

insurance is most common prepaid expense

usually pay one year coverage in advance
13.

late-arriving invoices

items can come in towards the end of an accounting period
14.

bill can possibly arrive later

at a different fiscal period
15.

financial statements usually not preped until 2-3 weeks after fiscal end

Peter Melkonian