Most accounting cycles are similar, which means that they usually contain the same steps. However, the items and people involved in each of the cycles vary. For example, a typical accounting cycle consists of identifying and recording transaction and other events, journalizing, posting, trial balance, adjusting entries, adjusting entries for accruals, adjusted trial balance, closing, post-closing trial balance, and reversing entries (Kieso et al, 2003). At the end of the cycle, one produces the relevant reports for the various users in the organization, or other users such as the government, lending institutions, and investors. My company follows a similar structure; however, the company uses an accounting information system that allows it to manage sales representatives, customers, and inventory, production, accounts payable, and accounts receivables.
The accounting cycle at my company starts with the sales person making a sale. These sales people live all across the country. Therefore, the usual way we receive an order is via fax.
However, sophisticated customers, such as the major chain stores use either email or their own proprietary systems to let somebody know us of an existing order in their system. These orders are the responsibility of Ivana, a thirty-five year old, Russian born immigrant. Every morning, she takes all the orders from the fax, email, and other locations, consolidates, checks them for errors and omissions, and then forwards the orders to Gloria, our order entry person.
Gloria, who is also thirty-five years old, is an African-American was born in Daytona Beach, Florida. She is one of the rare Florida born Floridians. Gloria is in charge of all data entry, which includes orders, receivables, payables, inventory, and invoicing. Once Gloria enters the orders, Ivana verifies the orders for accuracy. The order entry creates the information for the buyer, Jose, a fifty-three year old,