Trail balance is to help the business owner get a report of all accounts balances that have
Question:
Trail balance is to help the business owner get a report of all accounts balances that have credit (Credit the account when the assets/expenses decrease and the liabilities/revenues increase) or debits (Debit the account when the assets/expenses increase and the liabilities/revenues decrease) in the general ledger. it shouldn't be used as part of your true financial statement. Trail balance should be used to check if your journal entries are balanced and accurate if not doing a trail balance will provide to you that something is wrong and that you need to fix it. There are some limitations or errors that could occur in this process. For examples: Compensating error (two errors that match), duplication error (recorded more than once), omission error (transactions haven't been recorded), or even a reversal error (credit and debit entries are flipped). Some of theses errors can't be seen in which that all the debit and credit still balance to zero out.Below is just a small example of how a trail balance should look like the business is calculating their ledger.
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Auditing a business risk appraoch
ISBN: 978-0324375589
6th Edition
Authors: larry e. rittenberg, bradley j. schwieger, karla m. johnston