Before learn accounting, you should know the accounting cycle. My lecture and my boss suggest understanding it. We will not loss in way if we understand the cycle. We can solve any accounting problem by understanding cycle.

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Accounting cycle is a flow of accounting process. the process is begin from transaction and end at the

Financial stetement report.

1 Identify the transaction and transaction event

2. Gain the transaction proof like invoice or purchase order. The document is very important for the company's archive. The accounting public must ask the document if they want audit the company.

3 Note the transaction in certain journal. For example record the sales transaction into sales journal. Beside sales journal, you should prepare expense journal, cash receipts and general journal.

To simplyfy your journal, you can make code for transaction. Example 1 for asset; 2 for liability, 3 for equity, 4 for revenue, 5 for Cost of Gold Sold (COGS), 6 for expense, and so on.

4 Classify and categorize the transaction into some classes. Post general entries to ledger

5. Make a trial balance that accumulates the ledger. Trial balance accumulating all ledger account. This sheet is useful for checking the balance between debit and credit. If your trial balance is inbalance, You should check the journal entry whether it has been complete.

6. Correction the discrepancy between asset and liquidity side. Hence its name, the asset and liquity should be balance. The common mistakes of trial balance are journaling. Sometimes, accounting record the transaction to wrong account or record wrong nominal transaction.

Sometimes balance value between asset and liquidity does not guarantee your journal has been correct. Perhaps you were forget to post the journal. 

7. Record deferred, accrued, and estimates in adjusting entries than post the entries into general entries.

8. Prepare adjusted trial balance. This trial balance will help you to build financial statement report.

9 Make financial statement by allocate some item into balance sheet, income statement, cash flow statement and equity statement.

10 Close temporary account such as revenue, gains and losses and then prepare closing journal entries

11 Post closing entries to ledger account

12 Prepare after closing trial balance

13 Review reversing journal entry

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Accounting cycle in software

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If you use accounting software, You do not have to work much. You just need

1. Analyze the transaction of the company

2,Record the journal. You should make a right journal. For example. record the amount sales on sales journal

3 Click the report and you will see the complete financial statement.

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Today we can buy software to make financial statement. Make sure  you buy a good software which has good reputable. Unknown software could damage your financial statement.