After all transactions for the reporting period are posted to the general ledger, each account will have a balance at the end of that period. The balances of individual accounts are summarized in a table called the trial balance. The first trial balance prepared is unadjusted and the balances reported are based on posted balances, which can be wrong or need further adjustments. The unadjusted trial balance only proves the equality of total debits and credits. If these are not equal, there is an error that needs correction.

COURSE OBJECTIVES

The unadjusted trial balance is the first output of the accounting system that is not based directly on source documents but a result of previous processes. It is the first attempt to group transactions and present an overall view of the entity’s accounts. It facilitates review of the accounts for adjustment and identification of recording errors