An adjusted trial balance
A)is prepared after the financial statements are completed.
B)proves the equality of the total debit balances and total credit balances of ledger accounts after all adjustments have been made.
C)is a required financial statement under international financial reporting standards.
D)cannot be used to prepare financial statements.

Question

Quizplus · Accepted Answer

An adjusted trial balance is prepared after all adjusting entries have been recorded and posted to the general ledger accounts. The purpose of the adjusted trial balance is to prove the equality of the total debit balances and total credit balances of ledger accounts after all adjustments have been made. While the financial statements are prepared using the information from the adjusted trial balance, the adjusted trial balance itself is not considered a financial statement. The preparation of an adjusted trial balance is not a requirement under international financial reporting standards, but it is a common practice in accounting.

An Adjusted Trial Balance