Answer to Question #99369 in Finance for Shraddha Pardeshi

Question

2. Mr. Shil Wants to record the financial transactions of his newly started business. Discuss what accounting steps/stages he need to adhere so that the transactions can be duly recorded and processed in order to prepare the financial statements.

Answer 1

The main steps to record the financial transactions are:

1) Journal entries. The most basic method used to record a transaction is the journal entry, where the accountant manually enters the account numbers and debits and credits for each individual transaction.

2) Receipt of supplier invoices.

3) Issuance of supplier invoice.

4) Issuance of supplier payments.

5) Issuance of paychecks.