Accounting › Section B · Analyzing and recording transactions › Topic B.3
Starting the cycle: analyzing transactions
Before anything is written in the books, an accountant decides whether an event is a transaction at all, and if so, exactly which items it changes and by how much. That analysis is the first step of the accounting cycle, and getting it right makes every later step routine.
In this topic
- The accounting cycle
- What counts as a transaction
- Four questions for every transaction
- Every transaction has two sides
- Worked example: Larkhill's first week
- Checking the balance midway
- Worked example: the rest of March
- Effects on the financial statements
- Common mistakes to avoid
- Key takeaways
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