The five steps in the accounting cycle are listed as follows:
1)Close the accounts.
2)Post transactions to accounts in the ledger.
3)Journalize daily transactions.
4)Record and post adjustments.
5)Prepare financial statements.What is the correct order of these steps?

Question

Quizplus · Accepted Answer

The accounting cycle starts with journalizing daily transactions, followed by posting transactions to accounts in the ledger. Then, adjustments are recorded and posted. After adjustments, financial statements are prepared. Lastly, the accounts are closed out to start a new accounting period. Therefore, the correct order is 3, 2, 4, 5, 1, which is option B.

The Five Steps in the Accounting Cycle Are Listed as Follows