Which accounting standard governs the preparation of trial balances?
Practice Questions
Q1
Which accounting standard governs the preparation of trial balances?
IFRS
GAAP
Both IFRS and GAAP
None of the above
Questions & Step-by-Step Solutions
Which accounting standard governs the preparation of trial balances?
Step 1: Understand what a trial balance is. A trial balance is a list of all the accounts in the accounting system and their balances.
Step 2: Learn about accounting standards. These are rules that guide how financial statements should be prepared.
Step 3: Identify the two main accounting standards: IFRS (International Financial Reporting Standards) and GAAP (Generally Accepted Accounting Principles).
Step 4: Recognize that both IFRS and GAAP provide guidelines for preparing trial balances.
Step 5: Conclude that when preparing a trial balance, you can follow either IFRS or GAAP depending on the requirements of your country or organization.
