Trial Balance Revision Questions

Trial Balance Revision Questions

1)  Which one of the following is not the cause of an error in the Trial Balance?

1. A figure is entered in the wrong column of the Trial Balance
2. A column in the Trial Balance has been sumed incorrectly
3. A customer did not pay a bill on time
4. There is an error in one of the contributing accounts

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2)  Which one of the following statements is correct?

1. The sum of all Nominal account credits is greater than the sum of all debits
2. The sum of all Nominal account credits is less than the sum of all debits
3. The sum of all Nominal account credits is equal to the sum of all debits
4. None of the above

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3)  The balance in the Bank account is £1000 debit.  The balance in the Purchases account is £500 debit.  You pay £100 for goods.  Which one of the following statements is true?

1. The debit column of the Trial Balance increases by £200
2. The credit column of the Trial Balance decreases by £100
3. Both sides of the Trial Balance increase by £200
4. None of the above

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4)  If the sum of all credits in the Trial Balance is equal to the sum of all debits, this means there is no mistake in your accounts.

1. True
2. False

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5)  You pay expenses of £200.  Which one of the following statements is true?

1. The debit column of the Trial Balance increases by £200
2. The credit column of the Trial Balance increases by £100
3. There is no effect on the Trial Balance totals
4. Both Columns of the Trial Balance increase by £200

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6)  You pay £400 for goods and enter the correct amount in the Bank account, but enter £300 in the Purchases account.  Which one of the following statements is true?

1. Both Columns of the Trial Balance increase by £400
2. The debit column of the Trial Balance is £100 less than the credit column
3. Both Columns of the Trial Balance increase by £300
4. None of the above

Answer

7)  If the Trial Balance, balances, which one of the following statements is correct?

1. There is no mistake in the accounts
2. The sum of all the credits equals the sum of all the debits
3. The business is profitable
4. None of the above

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8)  You have a debit balance of £1000 in the Bank account.  You sell goods for £200 cash, pay rent of £100, pay wages of £100 and transfer £50 from the Bank to the Petty Cash account.  Which one of the following statements is true?

1. Both sides of the Trial Balance change by £50
2. Both sides of the Trial Balance change by £150
3. Both sides of the Trial Balance change by £250
4. The Trial Balance totals do not change

Answer

9)  Applying the PEARLS rule; for the Trial Balance to balance, every account in the 'P', 'E' or 'A' categories must be matched by an account in the 'R', 'L' or 'S' categories.

1. True
2. False

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10)  You buy a computer for £1,000 and update the Office Equipment account.  However, you enter £1,100 on the debit side of the Creditors Control account.  Which one of the following statements is correct?

1. The Trial Balance, balances
2. The debit side of the Trial Balance is £100 more than the credit side
3. The debit side of the Trial Balance is £2,100 more than the credit side
4. The credit side of the Trial Balance is £100 more than the debit side

Answer

Trial Balance Revision Answers

1)  Option (c) is correct.  Options a,b, and d will definitely lead to errors.  The timing of a customer payment has no impact on the Trial Balance.

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2)  Option (c) is correct.  Every debit entry must be matched with an equivalent credit entry, so the total must be equal.

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3)  Option (d) is correct.  Your Bank account has been reduced to £900 debit and Purchases has been increased to £600 debit.  This does not affect the totals in the Trial Balance.

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4)  Option (b) is correct.  This is false.  The Trial Balance checks the sum of debits is equal to the sum of credits.  This does not uncover certain types of error.  For example two errors, might cancel each other out.

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5)  Option (c) is correct.  The payment would reduce the balance in the Bank account by £200, and increase the debit balance in the Expenses account by £200.  Therefore, the totals will not be affected.

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6)  Option (b) is correct.  The Bank decreases by £400, so it is credited.  Purchases increase by £300, so it is debited.  In this case, the Trial Balance will not balance.

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7)  Option (b) is correct.  See question 4 above.  There are some errors that the Trial Balance will not detect.  The fact that the Trial Balance, balances, is not an indicator of profitability.

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8)  Option (d) is correct.  The debit balance in the Bank goes down by £50 and the balance in the Petty Cash account goes up by £50 debit.

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9)  Option (b) is correct.  This is false.  The two accounts involved in any double entry can be from any category.  For example, if you buy a vehicle, two Asset accounts could be involved.  Bank and Vehicles.

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10)  Option (c) is correct.  The Creditors Control entry should be on the credit side.  The amount is also wrong, £1,100 instead of £1,000.

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