Week Four DQ 1 due Day 2 (Tuesday)The Accounting Cycle Describe the required steps in the accounting cycle. Be sure to incorporate the accounting equation and how debits and credits work in your discussion. Week Four DQ 2 due Day 4 (Tuesday)Year-End Closing Entries Describe the nature and purpose of the adjusted trial balance. Explain the purpose of closing entries. Is there any difference in how closing entries are recorded as compared with recording daily transactions and adjusting entries Why or why not? GIVE ANSWER IN AT LIST 100 150 words to each Document Preview: study objectives After studying this chapter, you should be able to: 1 Explain the revenue recognition principle and the expense recognition principle. 2 Differentiate between the cash basis and the accrual basis of accounting. 3 Explain why adjusting entries are needed, and identify the major types of adjusting entries. 4 Prepare adjusting entries for deferrals. 5 Prepare adjusting entries for accruals. 6 Describe the nature and purpose of the adjusted trial balance. 7 Explain the purpose of closing entries. 8 Describe the required steps in the accounting cycle. 9 Understand the causes of differences between net income and cash provided by operating activities. chapter ACCRUAL ACCOUNTING CONCEPTS 4 ? Scan Study Objectives ? Read Feature Story ? Scan Preview ? Read Text and Answer p. 175 p. 180 p. 185 p. 189 ? Work Using the Decision Toolkit ? Review Summary of Study Objectives ? Work Comprehensive p. 197 ? Answer Self-Test Questions ? Complete Assignments ? Go to WileyPLUS for practice and tutorials ? Read A Look at IFRS p. 224 ? the navigator Do it! Do it! ? 162 c04AccrualAccountingConcepts.qxd 8/3/10 1:50 PM Page 162 feature story 163 The accuracy of the financial reporting system depends on answers to a few fundamental questions. At what point has revenue been earned? At what point is the earnings process complete? When have expenses really been incurred? During the 1990s, the stock prices of dot-com companies boomed. Many dot-com companies earned most of their revenue from selling advertising space on their websites. To boost reported revenue, some dot-coms began swapping website ad space. Company A would put an ad for its website on company Bs website, and company B would put an ad for its website on company As website. No money ever changed hands, but each company recorded revenue (for the value of the space that it gave up on its site). This practice did little to boost net income and resulted in no additional cash flowbut it did boost reported revenue. Attachments: accounting_6e.pdf