A.

ENUMERATE AND DISCUSS THE STEPS IN THE ACCOUNTING PROCESS

The Accounting Cycle

1. Identifying and analyzing documents (obtaining data and determining the implications of the accounts' transactions)
2. Journalizing. (The diary keeps track of the accounts that are identified (books of original entry)
3. Posting. (transferring the journal entries to the general ledger.)
4. Unadjusted Trial Balance. (ltheir balances on all accounts Debits and credits are equal.)
5. Adjusting Entries. (accounts updated on an accrual basis)
6. Adjusted Trial Balance. (After adjusting entries, transfer it to adjusted trial balance with equal of the debit and the credit.)
7. Financial Statements. (The financial statements are used to present the information that has been processed to the users.)
8. Closing the books. (The profit or loss is moved to equity accounts and the temporary (nominal) accounts are closed.)
9. Post closing trial balance. (After the closing entries, the balance of debits and credits is reviewed again.)
10. Reversing entries. (made at the start of the following accounting quarter.) The Reversing Entries are not required.
B. PROBLEM SOLVING
Debit Credit
1 Prepaid advertisment 10,000
Advertising expense 10,000
to record payment for advertising

2 Prepaid Insurance 6,000

Insurance Expense 6,000
to record expired portion insurance

3 Rent expense 30,000

Prepaid rent 30,000
to record expired portion of rent

4 Supplies expense 4,000

Supplies 4,000
to record physicial expense of supplies