Question

What is accounting cycle? In point

Answer 1

Accounting Policies – From the name itself, it is clear that these policies are set of rules that dictate a company’s financial accounting.
Accounting policies are set of rules or procedures by following which a company prepares its financial statements.
When a company prepares a complex statement or calculate an advanced method of accounting, it needs guidelines to adhere to. For examples of accounting policies, to choose depreciation method, a company needs to follow specific accounting policy.



Accounting policy may vary company to company; but whatever a company does in regards to accounting policy, it should be in accordance with the generally accepted accounting principles (GAAP) or International Financial Reporting Standards (IFRS).