Which of the following statements is TRUE of a trial balance?
A) A trial balance has the same format as a balance sheet.
B) A trial balance presents data in debit and credit format.
C) A trial balance shows the total amounts of assets and liabilities, but not equity.
D) A trial balance is prepared after the balance sheet.

Question

Quizplus · Accepted Answer

A trial balance is a list of all the accounts in the general ledger and their balances, arranged to show whether their sum equals zero (i.e., the total of all debits equals the total of all credits). Therefore, it presents data in debit and credit format. A trial balance is prepared before the financial statements, including the balance sheet. While the trial balance includes accounts for assets, liabilities, and equity, it does not show the total amounts, just the balances of each account. The format of a trial balance is typically vertical, unlike a balance sheet, which is horizontal.

Which of the Following Statements Is TRUE of a Trial