In a trial balance, what does it mean if the total debits do not equal total cre
Practice Questions
Q1
In a trial balance, what does it mean if the total debits do not equal total credits?
The accounts are balanced
There is an error in the accounting records
The company is profitable
The financial statements are complete
Questions & Step-by-Step Solutions
In a trial balance, what does it mean if the total debits do not equal total credits?
Step 1: Understand what a trial balance is. A trial balance is a list of all the accounts in the accounting records with their balances.
Step 2: Know that in accounting, every transaction affects at least two accounts. This means that for every debit entry, there should be an equal credit entry.
Step 3: Check the total debits and total credits in the trial balance. They should be equal.
Step 4: If the total debits do not equal total credits, it means there is a mistake somewhere in the accounting records.
Step 5: Investigate the records to find the error. This could be a wrong entry, a missing entry, or a calculation mistake.
