Here are the essential steps involved in the process of Account finalization for Grocery & Merchandise Stores:
1. Reconcile Accounts Payable:
This step entails comparing the accounts payable ledger’s balance with the balance on vendor statements. Any disparities should be identified and rectified.
2. Reconcile Accounts Receivable:
In this phase, the balance in the accounts receivable ledger is matched with the balance on customer statements. Any inconsistencies should be investigated and corrected.
3. Post Closing Entries:
These are journal entries made at the accounting period’s conclusion to close temporary accounts and transfer their balances to permanent accounts.
4. Prepare Financial Statements:
This involves creating crucial financial statements like the balance sheet, income statement, statement of cash flows, and statement of retained earnings.
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