Question 1

A trial balance contains the name of the company,the words "trial balance" and the date of the statement.

Accepted Answer

A trial balance should have the name of the company, the words "trial balance", and the date of the statement for it to be accurate and useful.

Question 2

Only the ________ accounts from the trial balance will be used to prepare the Income Statement.

Accepted Answer

Only the revenue and expense accounts will be used to prepare the Income Statement as it shows the company's revenue and expenses during a specific period. Asset and liabilities accounts are used for the Balance Sheet, while liabilities and Retained Earnings, as well as Stockholders' Equity and asset accounts, are not relevant for the preparation of the Income Statement.

Question 3

The purpose of the trial balance is to verify that all account balances are correct.

Accepted Answer

The purpose of the trial balance is to verify that total debits equal total credits in the ledger, not to verify the accuracy of account balances.

Question 4

The trial balance is an official financial statement.

Accepted Answer

The trial balance is not an official financial statement; it is an internal report used for checking the balance of debits and credits in the accounts, primarily for error-checking purposes.

Question 5

The columns on a trial balance represent:

Accepted Answer

The columns on a trial balance represent debits and credits. The purpose of a trial balance is to ensure that the total of all debits equals the total of all credits, which is the basic principle of double-entry accounting.

Question 6

An entry could have been posted twice and the trial balance might still balance.

Accepted Answer

If an entry is posted twice, it means that one account will be debited twice and another account will be credited twice, thus the effect on the trial balance will be nullified and it can still balance.

Question 7

On the trial balance,which account balances should be listed in the debit column?

Accepted Answer

Debit balances are typically associated with asset accounts (e.g. cash, accounts receivable, inventory), dividend accounts (e.g. dividends declared), and expense accounts (e.g. salaries expense, rent expense). Therefore, the accounts listed in choice C (assets, dividends, and expenses) will have debit balances and should be listed in the debit column on the trial balance.

Question 8

The trial balance:

Accepted Answer

The trial balance lists all accounts, with their balances, on a given date. It is used to ensure that the total debits equal total credits and is a tool for detecting errors. It is not limited to accounts used for the balance sheet or income statement.

Question 9

Caesar's Company's trial balance contains the following balances:
Cash $422 Accounts Receivable $377 Revenue $724
Accounts Payable $283 Expenses $208
What is the amount of total debits for this trial balance?

Accepted Answer

The total debits are calculated by adding Cash ($422), Accounts Receivable ($377), and Expenses ($208), which equals $1,007.

Question 10

A cash payment was made to pay for delivery expenses,but was mistakenly charged to Advertising Expense.What effect will this have on the trial balance?

Accepted Answer

The trial balance will still balance because it is a summary of all ledger accounts, and an error in classification between expense accounts does not affect the overall balance between debits and credits.

Question 11

Anthoney Inc's trial balance contains the following balances:
Cash $532 Accounts Payable $341 Revenue $671
Accounts Receivable $276 Expenses $204
What is the amount of total credits for this trial balance?

Accepted Answer

The total credits for this trial balance is $1,012. This is because the total of the credit balances ($276 + $671 = $1,012) is equal to the total of the debit balances ($532 + $341 + $204 = $1,012).

Question 12

Once the trial balance is correct,the next step is to prepare the financial statements,beginning with the Income Statement.

Accepted Answer

After preparing a correct trial balance, the next step is to prepare financial statements, starting with the income statement.

Question 13

If debits equal credits on the trial balance,it means that all the steps in the accounting process are correct.

Accepted Answer

While debits equaling credits on the trial balance indicates that the accounts are in balance, it does not guarantee that all transactions have been recorded correctly or in the right accounts. Errors or omissions can still occur.

Question 14

A trial balance is a list of the accounts and their balances taken from the general journal.

Accepted Answer

A trial balance is a list of the accounts and their balances taken from the general ledger, not the general journal.

Question 15

If the total debits and total credits on a trial balance do not equal,redo the addition of the debit and credit columns.

Accepted Answer

If the total debits and credits do not equal, it means there is an error in the trial balance. The first step to rectify the error is to redo the addition to ensure accuracy.

Question 16

Motor Work,Inc.'s trial balance contains the following balances:
Cash $367 Accounts Payable $267 Revenue $632
Accounts Receivable $429 Expenses $103
What is the amount of total debits for this trial balance?

Accepted Answer

The total debits for this trial balance is $899. This is because the total of the debit balances ($367 + $429 = $796) is equal to the total of the credit balances ($267 + $103 + $632 = $899).

Question 17

The required accounting period for a trial balance is one year.

Accepted Answer

The required accounting period for a trial balance can vary and may be shorter or longer than one year depending on the needs of the company or accounting standards.

Question 18

On the trial balance,which account balances should be listed in the credit column?

Accepted Answer

Liabilities, Retained Earnings, and Revenues are accounts with normal credit balances and should be listed in the credit column of a trial balance. Assets, Dividends, and Expenses typically have debit balances.

Question 19

A trial balance will determine if:

Accepted Answer

A trial balance is a statement that lists all the accounts in the general ledger and their balances. The purpose of a trial balance is to ensure that the total debits equal the total credits, which indicates that the accounting equation (assets = liabilities + equity) is in balance. If the trial balance does not balance, it may indicate errors in recording, posting, or classifying transactions. Therefore, the correct answer is that a trial balance will determine if debits equal credits. While it is possible to identify a duplicate entry or incorrect account postings through a trial balance, the primary purpose is to ensure that the overall balance of the accounts is correct.

Question 20

Which document would be best to prove that the account balances are correct?

Accepted Answer

The answer of Which document would be best to prove...

Quiz 2: Analyzing and Recording Business Transactions