ExpertEasy1 markMultiple Choice
ACCA · Question 65 · Preparing a Trial Balance
Section B - Case 2: Single Entity Accounts
Scenario: AquaHarvest Marine Farms
AquaHarvest prepares its financial statements for the year ended 30 September 20X6.
What is the primary purpose of preparing a trial balance before making these year-end adjustments?
Section B - Case 2: Single Entity Accounts
Scenario: AquaHarvest Marine Farms
AquaHarvest prepares its financial statements for the year ended 30 September 20X6.
What is the primary purpose of preparing a trial balance before making these year-end adjustments?
Answer options:
A.
To calculate the final profit for the year.
B.
To check the arithmetical accuracy of the double-entry bookkeeping.
C.
To ensure no errors of omission have occurred.
D.
To provide a final statement of financial position to shareholders.
How to approach this question
Recall the definition and purpose of a trial balance. It is a list of balances extracted from the ledger to ensure Debits = Credits.
Full Answer
B.To check the arithmetical accuracy of the double-entry bookkeeping.✓ Correct
The primary purpose of a trial balance is to verify the arithmetical accuracy of the ledgers by ensuring that total debits equal total credits. It does not detect all errors (such as errors of omission or principle) and is not a final financial statement.
Common mistakes
Believing a trial balance proves there are absolutely no errors in the accounts.
Practice the full ACCA FA — Financial Accounting Practice Exam 5
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