Question

Which of the following statements is true?

Multiple Choice

• The trial balance is a list of all the accounts in the journal

• A trial balance is only prepared at year end

• The trial balance is a list of the accounts in the general ledger

• Another name for the trial balance is the "chart of accounts"

• The trial balance is never used to prepare financial statements.

Answer 1

"The trial balance is a list of the accounts in the general ledger" is a true statement.

-> Trial balance is prepared out of all the accounts present in the general ledger hence the first statement is not true.

-> A trial balance may also be prepared monthly hence the second statement is not true.

-> Trial balance is a summary of all of the accounts maintained in the general ledger hence this third statement is true.

-> Chart of accounts is a list of account codes and names and is not another name for trial balance hence the fourth statement is also not true.

-> Trial balance forms the base for preparation for financial statements hence the fifth statement is also not true.