The First Required Step in the Accounting Cycle Is to

question 116

Multiple Choice

The first required step in the accounting cycle is to

• A)prepare reversing entries.
• B)journalize transactions in the book of original entry.
• C)analyze transactions.
• D)post transactions.

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Definitions:

Depreciable Asset

An asset which loses value over time due to wear and tear or obsolescence and can be written off as an expense over its useful life for tax and accounting purposes.

Selling Price

The amount of money a buyer pays to acquire a product or service from a seller.

Book Value

The value of a company's assets minus its liabilities, often used to assess its financial health or compare its market value.

Loss On Sale

An economic condition wherein the selling price of an asset is less than its carrying value, resulting in a financial loss.