What is meant by Accounting Cycle ? List its basic phases.

OR

What is 'data formatting' ? What tools are used to format a given data ?

Meaning: The accounting cycle means the process involved in identifying, measuring, and communicating the accounting information. The basic phases of this cycle are as follows: • Business transactions are analysed. • The transactions are recorded in Journal. • Journal entries are posted to ledger accounts. • A trial balance is prepared from the balances of accounts. • Accounts are reviewed and necessary adjustments are made. • Adjustments are posted in the ledger to prepare adjusted trial balance. • Adjusted Trial balance is used to prepare the balance sheet and profit and loss account. • Financial statements are prepared from the finally adjusted ledger and balancing accounts. Q. (b) What is ‘data formatting’?................................... Ans. Data formatting refers to setting up spreadsheet in such a way that the user of the information can read and understand the information easily and quickly. Several tools and shortcuts are available to format spreadsheet effectively. Following are the tools to format data: 1. Number formatting: • It includes adding %, decimal places, currency signs, date, time, scientific values etc. • Various number formats are available. 1. Special format category- for which one has to select ‘Special’ from category option. 2. Changing cell colours 3. Adding text formatting 4. Changing font size 5. Changing cell borders