The accounting cycle is a series of steps that businesses follow to record and process financial transactions. It begins with identifying and analyzing transactions, followed by recording them in journals. These entries are then posted to the general ledger, which organizes the data for further analysis. After posting, businesses prepare a trial balance to ensure that debits and credits are equal. This leads to the creation of financial statements, such as the income statement and balance sheet. Finally, the cycle concludes with closing the books and preparing for the next accounting period.