Part 1- O Level/IGSCE/Cambridge/Edexcel- Accounting & Book kipping- Accounting Cycle

Lesson 1- O Level/IGSCE/Cambridge/Edexcel- Accounting 7707- Topic: Accounting Cycle - Transaction Topper Accounting Center Get admitted for accounting private tuition. Accounting Coaching for English Medium Students O/A-Level Accounting – Edexcel/ Cambridge Classes Type: Online & Offline Contact : 01837625808, 01789444411 Address: House 64, Road 4, Block B, Mirpur 12, Dhaka 1216 Website: https://topperaccountingcenter.com/ Facebook Page:   / topperaccounting   The basic accounting cycle Now that we have covered all aspects of bookkeeping entries, we can show the whole accounting cycle in the form of the diagram in Exhibit 17.2. Note that the ‘accounting cycle’ refers to the sequence in which data is recorded and processed until it becomes part of the financial statements at the end of the period. Learning outcomes You should now have learnt: 1 What the Journal is used for. 2 That the Journal is the collection place for items that do not pass fully through the other five books of original entry. 3 That there is a range of possible types of transactions that must be entered in the Journal. 4 That the opening double entries made on starting a set of books for the first time are done using the Journal. 5 How to make the opening entries for a new set of books in the Journal and in the ledger accounts. 6 That the main parts of the accounting cycle are as follows: (a) Collect source documents. (b) Enter transactions in the books of original entry. (c) Post to ledgers. (d) Extract trial balance. (e) Prepare the trading and profit and loss account. (f) Draw up the balance sheet. The accounting cycle for a profit-making organisation Main books of original entry We have seen in earlier chapters that most transactions are entered in one of the following books of original entry: l Cash Book l Sales Day Book l Purchases Day Book l Returns Inwards Day Book l Returns Outwards Day Book. These books are each devoted to a particular form of transaction. For example, all credit sales are in the Sales Day Book. To trace any of the transactions entered in these five books would be relatively easy, as we know exactly which book of original entry would contain the information we are looking for.