What is the purpose of the accounting cycle?

The purpose of the accounting cycle is to ensure that a business's financial records are maintained in an orderly manner. This systematic process involves several steps, including recording transactions, posting to ledgers, preparing trial balances, and ultimately generating financial statements. By following the accounting cycle, businesses can accurately track their financial performance over a specified period, identify errors, and produce reports that reflect their financial status. This orderly approach to accounting is crucial for decision-making, compliance, and providing relevant information to stakeholders.

While other choices may relate to business operations—analyzing market trends, predicting future sales, and managing payroll—these functions do not specifically address the core objective of the accounting cycle, which focuses solely on the accurate recording and reporting of financial data. Thus, option B correctly captures the essence of the accounting cycle's primary purpose.