Which of the Following Statements Is TRUE

question 36

Multiple Choice

Which of the following statements is TRUE?

• A) A trial balance is in the same format as a balance sheet.
• B) A trial balance presents data in debit and credit format, but a balance sheet does not.
• C) A trial balance shows total amounts for assets, liabilities, and equity.
• D) A trial balance is created after the balance sheet is prepared.

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Definitions:

Free Assets

Assets that are not encumbered by any liens or claims, available to be used or sold freely by the owner.

Net Realizable Value

The estimated selling price of goods minus the costs of their sale or disposal.

Historical Cost

The original monetary value of an asset or investment, without adjustment for inflation or depreciation, used in accounting to determine financial statements.

Replacement Cost

The current cost of replacing an asset with another one of similar kind and quality in its existing condition.