Which of the following is true about a trial balance?
Correct answer: D. It lists down the balances of accounts
- A. It is not a part of accounting cycle
- B. It lists down the balances of a balance sheet
- C. It is a kind of financial statement
- D. It lists down the balances of accounts
Explanation
A trial balance lists the debit and credit balances of ledger accounts on a particular date. It is an internal checking schedule, not a financial statement or a balance sheet.
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About Accounting Principles
Accounting principles explain the rules used to record, classify and report business transactions. Coverage includes the accounting equation, double-entry system, accrual and cash bases, matching and prudence concepts, consistency, going concern, business entity, and the difference between capital and revenue items.
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