The Purpose of a Trial Balance Is To

question 105

Multiple Choice

The purpose of a trial balance is to:

• A)Affirm whether the figures in the account ledgers are correct and balanced.
• B)Prepare a mock up of a real balance sheet.
• C)Review the income statement accounts.
• D)Meet a reporting requirement of the Securities and Exchange Commission SEC).

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Definitions:

Monarchy

A form of government where a single person, the monarch, rules until death or abdication, with the position often inherited.

Profits

The financial gain realized when the revenue from business activities exceeds the expenses, costs, and taxes needed to sustain the activity.

Command Economy

An economic system where the government controls key sectors of the economy, determining what goods should be produced, their prices, and allocation.

Supplied Equals Demanded

A market equilibrium condition where the quantity of goods or services produced and offered by sellers matches the quantity that buyers are willing and able to purchase.