5 Questions
Which of the following best describes the accounting cycle?
A step-by-step process of recording, classification, and summarization of economic transactions
What is the purpose of the Sales Journal?
To record sales of merchandise on account
Which phase of the Accounting Cycle involves recording transactions?
Analyzing
What is the purpose of the Journal?
To provide a chronological record of transactions
Which step in the Accounting Cycle involves adjusting entries?
Unadjusted trial balance
Study Notes
Accounting Cycle
- The accounting cycle is the series of steps used to process, record, and report financial transactions.
Journal
- The purpose of the Journal is to record all financial transactions in a chronological order.
- The Journal is also known as the Book of Original Entry.
Sales Journal
- The purpose of the Sales Journal is to record credit sales.
- It is a specialized journal used to record sales transactions only.
Phases of Accounting Cycle
- The phase that involves recording transactions is the Journalizing phase.
- This phase involves recording financial transactions in the Journal.
Adjusting Entries
- The step in the Accounting Cycle that involves adjusting entries is the Adjusting phase.
- This phase involves updating the accounts to reflect any changes that have occurred since the last financial statements were prepared.
Test your knowledge of financial accounting and reporting with this quiz on the accounting process and special journals. Learn about the steps involved in the accounting cycle and familiarize yourself with the sales journal. Challenge yourself to understand the phases of the accounting cycle and the importance of recording and summarizing economic transactions.
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