The accounting process or accounting cycle is the activity of collecting and processing data in one period of time. In other words, the accounting cycle can be interpreted as the process of preparing financial statements. Of course, the financial statements must be made in detail and can be accounted for. Despite having an important role, not a few companies, especially small to medium scale, decided to arrange an accounting cycle using Bookkeepers Silverwater. Recording ordinary financial flows are not enough to be able to make business decisions that can help the development of business operations.
Generally, there are several points or verses in the adjusting entry. The first verse in the adjusting entry is error correction in the journalizing process. After that, you also need to record depreciation on fixed assets. It is also important for you to note the adjustment of rent paid at the beginning which changes to the rental expense. Usually, these changes are suspected to have benefits that have been used or exceeded. The next verse in the adjusting entry is the equipment that is turned into equipment load. This change is usually caused by equipment that has been used up. Next, you also need to check the revenue earned at the beginning which is then eliminated into service or service revenue. You can do this recording by adjusting the products or services sold.
You keep doing the recording in this adjusting journal until all errors or things you want to make sure have been revised. That way, you can record an adjustment journal without errors in the ledger. After keeping an adjusting entry, you also need to adjust the contents of the trial balance. This is because the adjusted trial balance will be used as a source of initial data for financial statement preparation activities. When making adjustments to the paragraph in the adjusting entry, the accounts that are experiencing an adjustment must have changed value. This is why the value of the balance in the trial balance needs to be re-adjusted with data following the adjusting entry.