FA Lecture 13

Question 1

Test format

Answer 1

10-20 Multiple choice questions

Written element

Question 2

Journal Posting

Answer 2

Is the act of transferring journal entries into relevant ledger accounts

Question 3

Trial balance

Answer 3

Consists of a list of the balances brought down on each ledger account separated into debits and credits.

Proves the mathematical equality of debits and credits after posting.

Question 4

Steps for preparing a trial balance

Answer 4

List the account titles and their balances

Total the debit and credit columns

Check the equality of the two columns

Question 5

Limitations of a trial balance

Answer 5

A trial balance may balance even when:

A transaction is not journalised

A correct journal entry is not posted

A journal entry is posted twice

Incorrect accounts are used in journalising or posting

Offsetting errors are made in recording the amount of a transaction.