An Adjusted Trial Balance

question 12

Multiple Choice

An adjusted trial balance

• A) is prepared after the financial statements are completed.
• B) proves the equality of the total debit balances and total credit balances of ledger accounts after all adjustments have been made.
• C) is a required financial statement under international financial reporting standards.
• D) cannot be used to prepare financial statements.

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Definitions:

Fixed Production Cost

Costs that do not vary with the level of production or sales volume, such as rent, salaries, and equipment depreciation.

Variable Selling Expense

Costs related to selling products that vary with the level of sales activity, such as commissions.

Net Operating Income

A company's income after operational expenses have been deducted but before taxes and interest are considered.

Milling Machine Minutes

A measure of manufacturing time that represents the total minutes a milling machine is engaged in production.