The Main Purpose of Preparing a Trial Balance Is to Ensure

question 37

Multiple Choice

The main purpose of preparing a trial balance is to ensure that:

• A)The total of recorded debits and total of recorded credits are equal.
• B)The company is making a profit.
• C)The total of revenue is equal to expenses.
• D)The total of recorded debits in revenue accounts are equal to total of recorded credits

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Definitions:

Adequate Consideration

A fair and reasonable value exchanged in a contract, ensuring that all parties receive something of value.

Arbitration Clause

A provision in a contract that requires the parties to resolve disputes through arbitration rather than through litigation in court.

Preexisting Duty

An obligation that a party is already legally bound to, which cannot serve as consideration for a new contract.

Forbearance to Sue

An agreement or arrangement where a party chooses not to pursue legal action in exchange for some form of compensation or under specific conditions.