If the Sum of the Debit Column Equals the Sum

question 93

Multiple Choice

If the sum of the debit column equals the sum of the credit column in a trial balance, it indicates

• A)no errors have been made.
• B)no errors can be discovered.
• C)that all accounts reflect correct balances.
• D)the mathematical equality of the accounting equation.

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Definitions:

Par Value

The nominal or face value of a bond, share, or other financial instrument, as stated by the issuer.

Effective Interest Method

An accounting technique for amortizing bond premium or discount over the life of the bond in a way that reflects a constant interest rate.

Amortization Table

A schedule that details each payment on an amortizing loan (such as a mortgage), including how much of each payment is interest vs. principal and the remaining balance.

Semiannual Interest

Semiannual interest is interest that is calculated and paid twice a year on investments or loans.