Learning Objective 3.4 Questions
1) Which of the following accounts would not be found on the credit side of a trial balance?
B) Accounts Payable
C) Retained Earnings
D) Sales Revenue
E) Paid-in Capital
2) Given the following balances, what would the total credits in the trial balance equal?
1. Equipment $52,000
2. Accounts Payable 1,000
3. Sales 51,000
4. Accumulated Depreciation 3,000
5. Accounts Receivable 4,000
6. Retained Earnings 13,000
7. Salary Expense 4,000
8. Cash 12,000
9. Paid-in Capital 10,000
10.Cost of Goods Sold 25,000
C) $ 97,000
3) Given the following complete list of balances, what will be the total credits in the trial balance, assuming no errors exist in the accounts? Note: The accounts payable records were damaged by a flood, and the company is not certain what the correct balance should be.
1. Retained Earnings $ 28,000
2. Merchandise Inventory 9,000
3. Accumulated Depreciation 5,000
4. Sales 42,000
5. Selling Expenses 11,000
6. Accounts Receivable $ 7,000
7. Cost of Goods Sold 22,000
8. Accounts Payable ?
9. Cash 5,000
10. Equipment 33,000
E) Due to the damage of the accounts payable records, it is impossible to determine the amount of the total credits on the trial balance.
4) The trial balance should be prepared
A) after preparing the financial statements.
B) before posting beginning balances to new accounts.
C) after posting closing entries.
D) before posting journal entries to the ledger.
E) after posting journal entries to the ledger.
5) If an accountant erroneously records an $8,000 credit to Accounts Payable instead of an $8,000 debit to the Cash account, the Accounts Payable account will be
A) understated by $8,000.
B) overstated by $8,000.
C) understated by $16,000.
D) overstated by $16,000.
E) correct since the erroneous entry caused the trial balance to equal.
6) A trial balance is similar to a balance sheet in that it only includes balance sheet accounts.
7) In a trial balance, the number of accounts that are debited do not have to equal the number of accounts that are credited, but the total dollar amount of the debits must equal the total dollar amount of the credits.
8) The trial balance serves two purposes. It verifies the clerical accuracy of the posting process and assists in preparing the financial statements.
9) The trial balance is an internal report that helps accountants prepare the financial statements.
10) A trial balance proves the equality of the total debits and total credits of the accounts listed.
11) If the debit side of a journal entry is posted but the credit side is not, the trial balance will not balance.
12) If an entry involving only two assets is not posted, the trial balance will be out of balance.