Which of the following statements is true?
A)Adjusting entries are recorded after the closing entries have been recorded.
B)Equal totals in a trial balance guarantees that no errors were made in the recording process.
C)Debits are equal to credits only after closing entries have been made.
D)The balance in the retained earnings account in the trial balance will equal the retained earnings balance on the balance sheet only after closing entries have been posted to the general ledger.

Question

Quizplus · Accepted Answer

The balance in the retained earnings account in the trial balance will need to be adjusted with the closing entries before it matches the balance sheet's retained earnings balance. Therefore, the statement in option D is true. Option A is incorrect because adjusting entries are recorded before the closing entries. Option B is incorrect because equal totals in a trial balance do not guarantee the absence of errors, as some errors may result in equal debits and credits. Option C is incorrect because debits and credits must be equal in every transaction, including adjusting and closing entries.

Which of the Following Statements Is True