Asked by Julie David on Jun 05, 2024
Verified
Which of the following is prepared first?
A) Balance Sheet
B) Income Statement
C) Statement of Owner's Equity
D) Trial Balance
Trial Balance
A bookkeeping worksheet wherein the balances of all ledgers are compiled into debit and credit columns to ensure that total debits equal total credits.
- Gain an understanding of the sequencing and preparation involved in financial statements.
Verified Answer
CE
Carlos ErnestoJun 06, 2024
Final Answer :
D
Explanation :
The Trial Balance is prepared first as it summarizes all ledger accounts' balances at a point in time, ensuring that total debits equal total credits. This step is crucial before preparing financial statements like the Income Statement, Statement of Owner's Equity, and Balance Sheet.
Learning Objectives
- Gain an understanding of the sequencing and preparation involved in financial statements.