BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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shows the ending account balance in a “debit” and “credit” format before posting the adjusting journal entries
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is prepared after closing entries have been posted
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shows the ending account balances resulting from the adjusting journal entries in a “debit” and “credit” format
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is a tool used by financial analysts to review the performance of publicly traded companies
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Detailed explanation-1: -The adjusted trial balance shows the final balances of the accounts, computed after all the adjustments. These balances are shown in the debit and credit format, which differentiates between the debit balance and credit balance. This, this option is correct.
Detailed explanation-2: -What is an adjusted trial balance? An adjusted trial balance lists the general ledger account balances after any adjustments have been made. These adjustments typically include those for prepaid and accrued expenses, as well as non-cash expenses like depreciation. It’s that simple.
Detailed explanation-3: -An adjusted trial balance is prepared by creating a series of journal entries that are designed to account for any transactions that have not yet been completed. These items include payroll expenses, prepaid expenses, and depreciation expenses.
Detailed explanation-4: -An adjusted trial balance is a report in which all debit and credit company accounts are listed as they will appear on the financial statements after making adjusting entries.
Detailed explanation-5: -Adjusted trial balance is the list of accounts and its adjusted balances after the adjusting entries were journalized in the general journal and posted to the general ledger. This is the step done before the financial statements are prepared.