The ACCOUNTING CYCLE results in the preparation of the financial statements: the balance sheet and the income statement.
Step 1 ANALYZING AND CATEGORIZING DOCUMENTS.
Step 2 PUTTING THE INFORMATION INTO JOURNALS.
Step 3 POSTING THAT INFORMATION INTO LEDGERS. (These first three steps are continuous.)
Step 4 PREPARING A TRIAL BALANCE(summarizing all the data in the ledgers to see that the figures are correct and balanced.)
Step 5 PREPARING AN INCOME STATEMENT AND BALANCE SHEET.
Step 6 ANALYZE THE FINANCIAL STATEMENTS AND DETERMINE FINANCIAL HEALTH OF COMPANY.