Question

It is a check on the accuracy of posting. If the trial balance agrees it proves that -
1. The books are arithmetically accurate
2. 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 ___________________.

• A. $1$ but not $2$
• B. $2$ but not $1$
• C. Both $1$ & $2$
• D. Either $1$ or $2$

Answer 1

The correct option is C Both $1$ & $2$

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).