chapter 12: the trial balance

Question 1

define trial balance

Answer 1

a list of all the balances in the general ledger, cash and bank balances from the cashbook and the petty cash balance fromthe petty cash book as well as the totals of lists of debtors and creditors

Question 2

what are the reasons of preparing a trial balance?

Answer 2

• to check the arithmatic accuracy in the accounts
• check the correctness of double entry
• enables final accounts to be prepared
• assists in locating errors

Question 3

differentiate between the trial balances

Answer 3

pre-adjustments- trial balance prepared with the balances extracted from the ledger accounts at the end of the month before taking into account any year-end adjustments.
post-adjustments- trial balance prepared at the end of the financial period after taking into account the year end adjustments
post-closing- trial balance prepared at the ed of the financial period after the nominal accounts and drawings account have been closed off and transferred to the final accounts