Our CTC teacher, Mrs. Billington, is using highly engaging, hands-on activities to discuss the "8 Steps in the Accounting Cycle" this week. Utilizing differentiated instruction, multiple stations, and peer-to-peer learning, the students are stamping their learning to become future accountants. Great job, Mrs. Billington and the Tyler ISD CTC students!
During this lesson, students will learn the following:
Understanding the Accounting Cycle: The accounting cycle is a series of steps that businesses use to track and report their financial transactions. It’s essential for maintaining accurate financial records.
Identify Transactions: This involves recognizing and documenting all business transactions that occur, such as sales, purchases, and expenses. Emphasize the importance of capturing all relevant data.
Record Transactions: Transactions are recorded in journals using double-entry bookkeeping. Highlight the significance of accuracy and consistency in this step.
Post to Ledger Accounts: After transactions are recorded, they are transferred to ledger accounts. Explain how this helps in organizing financial data and prepares it for reporting.
Prepare a Trial Balance: A trial balance is prepared to ensure that debits equal credits. Discuss the importance of this step in identifying any errors in the previous stages.
Make Adjusting Entries: Adjusting entries are made to account for accrued and deferred items. This step ensures that revenues and expenses are recorded in the correct accounting period.
Prepare Financial Statements: Financial statements, including the income statement, balance sheet, and cash flow statement, are prepared from the adjusted trial balance. Talk about how these statements provide insights into the financial health of a business.
Close Temporary Accounts: Temporary accounts, such as revenues and expenses, are closed at the end of the accounting period to prepare for the next cycle. Discuss why this step is crucial for accurate reporting in the next period.