An Adjusted Trial Balance is a key accounting tool that lists all general ledger accounts and their balances after accounting adjustments have been made, such as prepayments and accruals, serving as a foundational element for preparing the final financial statements.
The amount representing the difference between the debit and credit sides of an account. It is brought down onto the opposite side of the account to ensure equal totals.
A balancing figure is inserted in accounting to ensure that the totals of both sides of the ledger are equal, typically when preparing a trial balance.
A cash book is a financial journal that contains all cash receipts and payments, including bank deposits and withdrawals. It records transactions chronologically and is frequently reconciled with the bank statement to ensure accuracy and integrity in financial reporting.
Columnar accounts refer to accounts that are organized in multiple columns to present financial information more clearly and systematically. This structure is often used to present a trial balance, facilitating automatic adjustments into financial statements.
A compensating error is an accounting error that is balanced out by another error, making the errors cancel each other out so that the trial balance does not reveal the mistake.
The Cost Ledger Control Account, also known as the Cost Control Account, is an essential component of an accounting system where separate books are maintained for financial and cost records, ensuring the accuracy and integrity of the overall accounting system.
An original entry error is a mistake made in a book of prime entry such as a purchase incorrectly entered in the purchase day book, which is not revealed by a trial balance.
A Post-Closing Trial Balance is prepared after closing entries are recorded and posted, ensuring that beginning balances for the next accounting period are accurate and free of temporary accounts.
The Preclosing Trial Balance is an internal financial statement used to ensure that total debits equal total credits before the financial books are closed for the accounting period.
Tick marks are symbols used by auditors to indicate that they have performed a certain operation during an audit, such as verifying a number on a trial balance against a source document or checking the addition of a column of numbers. A legend should appear on the work papers to indicate the meaning of each tick mark.
A trial balance is a bookkeeping worksheet in which the balances of all ledgers are compiled into debit and credit columns. This process helps ensure the accuracy of the company’s financial records and is a critical step in the accounting cycle.
