A Trial Balance That Is Out of Balance Indicates That

question 110

Multiple Choice

A trial balance that is out of balance indicates that:

• A)The number of ledger accounts with debit balances is not equal to the number of accounts with credit balances.
• B)A debit has been posted to the wrong account.
• C)There is not an equality of debit and credit amounts in the ledger.
• D)A journal entry has been completely omitted from the posting process.

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Definitions:

Permanent/Temporary

Classification of accounts where permanent accounts (real accounts) represent ongoing items that are not closed at the end of the accounting period, whereas temporary accounts (nominal accounts) are closed.

Trial Balance

A bookkeeping worksheet in which the balances of all ledgers are compiled into debit and credit account column totals that are equal, ensuring accuracy of the figures.

Post-closing Trial Balance

The trial balance prepared after closing entries have been posted to ensure that debits and credits still balance, marking the end of an accounting period.

Normal Balance

The side of an account (debit or credit) that is expected to increase; for assets and expenses, it’s debit; for liabilities, equity, and revenue, it's credit.