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What is a trial balance?
A listing of ledger balances on a particular date.
Why is trial balance prepared? Give one reason.
either: To check for arithmetic accuracy and completeness of double entries or To facilitate the preparation of financial statements.
Which of the following appear in the debit column of the Trial Balance? Advertising, Cash in hand, Drawings, Fixtures and fittings, Trade receivables
All
Which of the following appear in the credit column of the trial balance? Capital, Drawings, Sales returns, Sales revenue, Stationery.
Capital and Sales revenue
The cash at bank is reported in the credit column. What does that mean?
It is a bank overdraft
State if loan from bank is reported in the debit or credit column of the trial balance.
Credit
Is Loan to Employee reported in the debit or credit column? Why?
Debit because it is an asset.
Is cost of sales reported in the debit or credit column? Why?
Debit because it is an expense.
In which column will discount received appear?
Credit.
After the trial balance is prepared, the owner contributed $4 000 cash into the business bank account. How will this affect the trial balance?
Cash at bank will increase $4000; Capital will increase $4000
After the trial balance is prepared, the business bought inventory $1 000 on credit.
Inventory and trade payable will increase by $1000
After the trial balance is prepared, business paid rent expense, $800.
Cash at bank decreased by $800; Rent expense increased by $800
After the trial balance is prepared, the owner took inventory for own use, $600. What changes must be made to the trial balance items?
Inventory will reduce by $600; Drawings will increase by $600
