4. Trial balance Flashcards
(23 cards)
What is a trial balance?
A trial balance is a listing of ledger balances on one particular date.
Why is a trial balance prepared?
Or What are the purposes of preparing trial balance?
Or State the functions of trial balance.
- To check for complete and proper double entries made in the ledger
- To help in the preparation of financial statement.
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance:
Advertising
Expense; Debit
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance:
Bank charges
Expense; Debit
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance:
Capital
Equity; Credit
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance:
Drawings
Contra equity; Debit
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance:
Fixture and Fittings
Asset; Debit
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance:
Heat and Light
Expense; Debit
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance:
Insurance
Expense; Debit
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance:
Interest on loan
Expense; Debit
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance:
Loan
Liability; Credit
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance:
Cost of Sales
Expense; Debit
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance:
Sales Revenue
Revenue; Credit
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance:
Sales returns
Contra revenue; Debit
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance:
Inventory
Asset; Debit
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance:
Accumulated Depreciation
Contra asset; Credit
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance:
Allowance for impairment of trade receivables
Contra asset; Credit
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance:
Accrued insurance
Liability; Credit
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance:
Bank overdraft
Liability; Credit
The trial balance shows discounts $140 in the credit column. Is this discount allowed or received? Why?
Discount Received. It is an income.
The trial balance shows rent $1 440 in the credit column. Is this rent expense or income?
Rent income.
Identify the class / nature of the following item and state if the item appears in credit or debit column of the trial balance?
Trade payable
Liability; Credit
If bookkeeper failed to do proper double entry, will trial balance balance?
No. Trial balance can only balance if proper double entries are done.
