Accounting Cycle Quiz

is the systematic recording of business transactions in a journal. This is sometimes considered as the first step in the accounting cycle as transactions are recorded for the first time in chronological order.

Is the process of transferring the accounts from the journal to the ledger. the effects of the transactions in the individual accounts.

Is prepared at the end of an accounting period to prove the equality of debits and credits. This is a list of accounts and their balances as of the end of the accounting period.

These are any medium of exchange that a bank will accept for deposit at face value. In includes coins, currency, checks, money orders, bank deposits and drafts.

This account is used to record the original and additional investments of the owner of the business entity. It is increased by the amount of profit earned during the year or is decreased by a loss.

is a representation to separate debit from credit in the form of 'T', whereas debit entry is put in the left while credit entry is in the right side.

Revenues earned by performing services for a customer or client; for example, accounting services by a CPA firm, laundry services by a laundry shop.

Revenues earned as a result of sale of merchandise, for example, sale of building materials by a construction supplies firm.

Expense for space, equipment or other asset rentals.

The book of original entry.