PRC-1 · Chapter 3 · Question 90 of 100
What specifically differentiates an 'Adjusted Trial Balance' from an 'Unadjusted Trial Balance'?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) The adjusted trial balance is prepared after posting end-of-period adjustments like accruals, prepayments, and depreciation.
Explanation
An unadjusted trial balance is extracted before year-end adjustments. Once necessary journal entries for accruals, prepayments, and depreciation are posted, an adjusted trial balance is generated to prepare the final financial statements.
More Ledgers and Trial Balance MCQs
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