Question

Identify which items are steps in the accounting cycle?

1) Post transactions to the ledger.
2) Prepare an adjusted trial balance.
3) Ensure transactions are authorized by the shareholders.
4) Prepare a post-closing trial balance.

Answer 1

Steps in the accounting cycle include posting transactions to the ledger, preparing an adjusted trial balance, and preparing a post-closing trial balance. Authorization by shareholders is not a step in the accounting cycle.

Step-by-step explanation:

The steps in the accounting cycle involve analytical and bookkeeping processes used to prepare financial statements. Out of the options provided, the following are steps in the accounting cycle:

1. Post transactions to the ledger.
2. Prepare an adjusted trial balance.
3. Prepare a post-closing trial balance.

Ensuring transactions are authorized by the shareholders is not directly a step in the accounting cycle, but rather part of the internal control process within an organization to ensure the legitimacy of financial transactions.