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CBSE Questions for Class 9 Elements Of Book Keeping And Accountancy Trial Balance Quiz 3 - MCQExams.com
CBSE
Class 9 Elements Of Book Keeping And Accountancy
Trial Balance
Quiz 3
Preparation of Trial Balance helps, mainly in ________.
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summarising business transactions
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verifying the 'generally accepted accounting principles' have been observed
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finalising the 'sources and uses of funds' statement
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locating errors, if any, in books of accounts
Explanation
Trial balance is prepared at the end of the financial year to check the accuracy of the books of account. If trial balance agrees, this can be assume that the books of account are arithmetical correct. But there are other types of errors which are there even the trial balance is tally.
Preparation of trial balance helps in locating the following error:
Compensating error
Error ofomission
Error of principle
Trial balance is a conclusive proof of accuracy of accounts.
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True
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False
Explanation
False. Trial balance is not a conclusive proof of accuracy of accounts as the trial balance might tally in cases where there are compensating errors. Hence, it does not justify that the accounts are free from any frauds or errors.
Balance appearing on the credit side of the trial balance is _________.
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a gain
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a revenue
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a liability
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all of these
Explanation
There are certain rules for the different type of account i.e personal a/c, real a/c and nominal a/c. On the basis of these rules, all expenses, losses and assets are debited and all revenue, gains and liabilities are to be credited.
At the end of the accounting period or at the end of each month, the balances of the ledger accounts are extracted and is prepared to test as to whether the total debits are equal to total credits.
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Profit & Loss Account
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Balance Sheet
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Cash Flow Statement
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Trial balance
Explanation
A trial balance is prepared at the end of the accounting period or at the end of each month, the balances of the ledger accounts are extracted and is prepared to test as to whether the total debits are equal to total credits. Its prepared to check the arithmetical accuracy of the books of account.
Trial balance is an account.
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True
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False
Explanation
False. Trial balance is not an account its a statement. It is a statement which lists the balances of all the ledger accounts.
Which of the following is the objective of trial balance?
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To ascertain the geometrical accuracy of the ledger accounts.
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To help in locating errors.
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To help in the preparation of the accounting report.
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None of the above
Explanation
The trial balance is prepared to fulfill the following objectives:
1. To ascertain the arithmetical accuracy of the ledger accounts.
2. To help in locating errors.
3. To help in the preparation of the financial statements.
A ______ is a schedule or list of balances of both debit and credit extracted from various accounts.
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Profits & Loss Account
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Balance Sheet
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Cash Flow Statement
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Trial balance
Explanation
Trial balance is normally prepared at the end of the financial year to check whether all entries are posted in the ledger. It is prepared by taking the balances of both debit and credit extracted from various accounts in a list.
If trial balance agrees, it proves that books are arithmetically correct.
Which of the following statements is correct?
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The trial balance is prepared after preparing the profit and loss account.
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The trial balance shows only balances of assets and liabilities
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The trial balance shows only nominal account balances.
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The trial balance has no statutory importance from the point of view of law.
Explanation
Trial balance is prepared by taking all the ledger account balances in a list. Trial balance is prepared to check the arithmetical accuracy of books of account. If trial balance agrees, it is assumed that the books of account are arithmetical correct. So, it is prepared just to check that all posting are done. Trial balance has no statutory importance from the point of view of law.
The balances of all assets accounts, expenses accounts, losses, drawing are placed in the __________ of the trial balance.
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credit column
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debit column
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ledger folio
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none of the above
Explanation
There are golden rule of accounting for recording the transactions based on the type of account i.e personal a/c, real a/c and nominal a/c.
Based on such rules of accounting, assets account, expenses account, losses and drawings are always have a debit balance. Hence while preparing the trial balance, all such accounts are placed in the debit column of the trial balance.
What is UNCOMMON in trial balance?
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Balances of personal, real and nominal account are shown
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Closing stock appears in trial balance
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Statement of assets and liabilities
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Both b & c
Explanation
What is uncommon in the trial balance is closing stock appears in the trial balance and statement of assets and liabilities. The trial balance has balances of personal, nominal and real accounts.
Closing stock will never appear in the Trial Balance.
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True
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False
Explanation
Closing stock (Dr. balance) will be given in the trial balance, if purchase account is already adjusted with the closing stock.Therefore, in such situation, adjusted purchase will be shown on the debit side of the trading A/c and closing stock will be shown on the asset side of the Balance Sheet.
The balances of all liabilities accounts, income accounts, profits, capital are placed in the _________ of the trial balance.
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credit column
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debit column
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ledger folio
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none of the above
Explanation
There are golden rule of accounting for recording the transactions based on the type of account i.e personal a/c, real a/c and nominal a/c.
Based on such rules of accounting, liabilities account, income account, profits and capital are always have a credit balance. Hence while preparing the trial balance, all such accounts are placed in the credit column of the trial balance.
Which of the following statement contains all the types of account i.e., personal, real & nominal account?
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Balance sheet
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Trial balance
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Income statement
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None of the above
Explanation
Trial balance is a list of all the balances of each of the account. It includes all accounts of expenses, incomes, assets, liabilities, personal account.
Preparation of trial balance includes all types of account i.e. personal, real ad nominal account.
___________ is a statement of debit & credit balances, while __________ is a statement of assets and liabilities.
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Profit & loss, Balance sheet
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Trial balance, Balance sheet
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Balance sheet, Trading account
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Trial balance, Profit & loss
Explanation
Trial balance is a list of all the balances of each of the account. It includes all accounts of expenses, incomes, assets, liabilities, personal account.
Balance Sheet is a statement of assets and liabilities. It shows the financial position of the organization on a particular date.
State with reasons whether the following statement is true or false:
Trial Balance is prepared after preparing the Profit and Loss A/c.
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True
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False
Explanation
False. Trial balance is prepared before preparation of Profit and loss A/c and is prepared after all the ledger accounts are balanced. After the trial balance is made only then the final accounts are prepared.
Bank overdraft is shown on the _______ side of trial balance.
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credit
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debit
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front
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none of these
Explanation
Bank overdraft is a liability and liabilities are always having a credit balance.
Therefore, bank overdraft is to be shown on the credit side of the trial balance.
Which of the following is/are method for preparation of trial balance?
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Balances Method
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Totals Method
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Both (A) & (B)
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None of the above
Explanation
Trial balance is normally prepared at the end of the financial year to check whether all entries are posted in the ledger. If trial balance agrees, it proves that books are arithmetically correct. Trial balance can be prepared by various methods:
1) Balance method in which only net balances of each account are carried to trial balance depend on the balance i.e. debit or credit.
2) Totals method in which the total of both the sides i.e. debit and credit are carried to the trial balance.
The credit side of trial balance show __________.
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Bank
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Cash
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Equipment
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None of the above
Explanation
Assets account always shows debit balance. Bank, cash and equipment are assets and will always have debit balance. These are to be shown in the debit side of trial balance.
Which of the following best describes a trial balance?
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It is a list of balances on the books
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Shows the financial position of a business
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Shows all the entries in the books
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It is a special account
Explanation
The best description of a trial balance is a statement that shows all the entries in the books. A trial balance is a statement that contains all the balances of real, nominal, and personal accounts.
If the totals of two columns of trial balance are equal it means _________.
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ledger posting is correct
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no outstanding debit
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no outstanding credit
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all of the above
Explanation
Accounting is based on the dual aspect concept where for every debit there will be a credit. Hence both the sides i.e. debit and credit are always have equal amounts.
Trial balance is prepared to check that posting of all the transactions is done properly. if the total of two columns of trial balance are equal, it means that posting is done for all the transactions and books are arithmetically correct.
Trial balance proves only the __________ accuracy of ledger posting.
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debit values
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accounting
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arithmetical
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credit values
Explanation
Trial balance is prepared to check that posting of all the transactions is done properly. if the total of two columns of trial balance are equal, it means that posting is done for all the transactions and books are arithmetically correct.
One of the objective of preparing Trial Balance is to help locate ___________.
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clerical errors
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financial statements
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difference between ledger and journal
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none of the above
Explanation
The prime objective of preparation of trial balance is to ensure the posting of all transactions. If trial balance agrees, it proves that the books are arithmetically correct. If trial balance does not agrees, there are possibilities of clerical error in the books of account.
Locating clerical error is one of the basic objective of preparation of trial balance.
It is irrelevant to check below mentioned to trace the error in trial balance:
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Check the total of debit and credit column
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Totals of subsidiary books
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No mistakes in the balancing of various accounts
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None of the above
Explanation
Trial balance have two sides i.e. debit and credit. As accounting is based on dual aspect concept, both the sides must show the equal total. Some of the errors can be disclosed from the trial balance and some are not disclosed from the trial balance.
To find out the errors in trial balance,it is irrelevant to check the below mentioned points:
1) Checking of debit and credit columns
2) Total of subsidiary books
3) No mistakes in the balancing of various accounts.
The statement showing balance of all the ledger accounts is known as ______________.
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Trial balance
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Balance sheet
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Bank reconciliation statement
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Profit and loss account.
Explanation
Trial Balance may be defined as a statement which contains balances of all ledger accounts on a particular date.
In case of Trial Balance, balance comes from _________.
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Journal
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Ledger
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Balance Sheet
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Profit & Loss A/c.
Explanation
Trial Balance may be defined as a statement which contains balances of all ledger accounts on a particular date.
Which of the following will disturb the balancing of the trial balance?
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Error in adding up a book of prime entry
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Entering an acquisition of an asset, on credit terms, in the Purchases Day Book
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Posting to an asset account instead of an expenditure account
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Entering a wrong amount in a book of prime entry
It is a check on the accuracy of posting. If the trial balance agrees it proves that -
The books are arithmetically accurate
Both the aspects of the transactions have correctly recorded in the books of original entry as well as in the ledger.
The correct answer is ___________________.
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$$1$$ but not $$2$$
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$$2$$ but not $$1$$
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Both $$1$$ & $$2$$
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Either $$1$$ or $$2$$
Explanation
The trial balance is prepared to fulfill the following objectives :
1. To ascertain the arithmetical accuracy of the ledger accounts.
2. To help in locating errors.
3. To help in the preparation of the financial statements. (Profit & Loss account
and Balance Sheet).
Bank overdraft is shown on the _____side of trial balance.
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Credit
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Debit
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None
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Both
Explanation
Bank overdraft is shown on the credit side of the trial balance. Bank overdraft is a liability for the company as it is to be paid at a future date.
A _______ is a schedule or list of balances of both debit and credit extracted from various accounts.
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Profit & Loss Account
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Balance Sheet
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Cash Flow Statement
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Trial Balance
Explanation
A Trial balance is a schedule or list of balances of both debit and credit extracted from various accounts. It is basically a worksheet showing debit and credit balances of all ledger accounts and the total of both should be same thereby ensuring the arithmetical accuracy of books of accounts.
Which of the following statements is correct about trial balance?
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A Trial balance is a list of all entries made in the books of account
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A Trial balance is a list of balances in all assets accounts
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A Trial balance is another ledger account
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A Trial balance is a list of balances in the cash account and all ledger accounts.
Explanation
Trial balance is prepared to check and confirm the posting of all accounting entries. Trial balance is prepared with the help of ledger account. All the balances from each of ledger account is taken in a list in the debit and credit column. Both the sides of trial balance must be equal as accounting is based on the double entry system of accounting.
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Practice Class 9 Elements Of Book Keeping And Accountancy Quiz Questions and Answers
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