Journalizing transactions – Recording each business transaction in a journal.
Posting to the ledger – Transferring the journalized transactions into the ledger accounts.
Preparing a trial balance – Summarizing the balances from the ledger to check accuracy.
Making end-of-period adjustments – Adjusting for accrued revenues, expenses, and deferrals.
Preparing an adjusted trial balance – Incorporating adjustments into the trial balance.
Preparing financial statements – Compiling the income statement, balance sheet, and cash flow.
Journalizing and posting closing entries – Closing temporary accounts like revenues and expenses.
Preparing an after-closing trial balance – Ensuring all temporary accounts are reset.
Establishing accountability for assets and transactions.
Tracking routine business activities, such as monitoring bank balances and outstanding payments.
Retrieving detailed transaction data when necessary.
Assessing the performance of different business units.
Maintaining documentary evidence for audits, tax filings, and compliance.
These records support both internal decision-making and external reporting needs.