Question

The first step in accounting cycle is ______.

Options

• Recording of transactions in journal

• Preparing income statement

• Posting entries in ledger

• Preparing balance sheet

Answer 1

The first step in accounting cycle is Recording of transactions in journal.

Explanation:

The first step in the accounting cycle is recording transactions in the journal, also known as journaling. This step involves documenting all financial transactions in chronological order as they occur. After transactions are recorded in the journal, they are posted to the ledger, which is the next step in the cycle.