Accounting Cycle Flashcards

(20 cards)

1
Q

What is the first step of the accounting cycle?

A

Identifying and analyzing transactions.

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2
Q

True or False: The second step of the accounting cycle is to journalize transactions.

A

True.

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3
Q

Fill in the blank: The third step of the accounting cycle is to ________ the journal entries.

A

post.

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4
Q

What is the purpose of adjusting entries in the accounting cycle?

A

To ensure that revenues and expenses are recognized in the correct accounting period.

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5
Q

Which step follows the preparation of adjusted trial balance?

A

Preparing financial statements.

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6
Q

Multiple Choice: What is the seventh step of the accounting cycle? A) Closing entries B) Adjusted trial balance C) Journalizing

A

A) Closing entries.

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7
Q

True or False: The final step of the accounting cycle is the preparation of post-closing trial balance.

A

True.

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8
Q

What document is created to summarize all transactions of a business for a specific period?

A

Financial statements.

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9
Q

Fill in the blank: The ________ trial balance is prepared after adjusting entries are recorded.

A

adjusted.

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10
Q

What is the main purpose of closing entries?

A

To reset the balances of temporary accounts to zero for the next accounting period.

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11
Q

Multiple Choice: Which of the following is NOT a step in the accounting cycle? A) Posting B) Closing C) Marketing

A

C) Marketing.

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12
Q

What are the two types of accounts that are affected by closing entries?

A

Temporary accounts and permanent accounts.

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13
Q

True or False: The accounting cycle is a continuous process.

A

True.

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14
Q

What is the fourth step in the accounting cycle?

A

Preparing an adjusted trial balance.

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15
Q

Fill in the blank: The ________ entries are made at the end of an accounting period to update account balances.

A

adjusting.

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16
Q

What is the fifth step of the accounting cycle?

A

Preparing financial statements.

17
Q

Multiple Choice: Which of the following is the first step of the accounting cycle? A) Financial statements B) Journal entries C) Analyze transactions

A

C) Analyze transactions.

18
Q

What is the role of the trial balance in the accounting cycle?

A

To ensure that total debits equal total credits before financial statements are prepared.

19
Q

Fill in the blank: After financial statements are prepared, the next step is to prepare ________ entries.

20
Q

What is the last step of the accounting cycle?

A

Close the books