The procedure used by accountants to convert data about transactions to financial statements is called _____.
A) the cash flow method
B) the statement of owners' equity
C) the accounting cycle
D) the balance sheet

Question

Quizplus · Accepted Answer

The accounting cycle is the procedure used by accountants to convert data about transactions to financial statements. This involves a series of steps including recording transactions, posting to the general ledger, preparing an unadjusted trial balance, making adjusting entries, preparing an adjusted trial balance, preparing financial statements, and closing the books. The cash flow method, statement of owners' equity, and balance sheet are all financial statements that are prepared as part of the accounting cycle, but they are not the procedure itself.

The Procedure Used by Accountants to Convert Data About Transactions