Trial Balance: Purpose and Limitations

Steps:

• Recall that a trial balance lists all ledger account balances to check if debits equal credits.
• Identify its primary role: verifying arithmetic accuracy in totaling and balancing accounts.
• Evaluate options against this: A matches error detection in records; others overstate its proof or scope.
• Confirm A as correct by noting it aligns with standard accounting principles without claiming infallibility.

Why A is correct:

• A trial balance ensures debits equal credits, highlighting arithmetical errors like addition mistakes in bookkeeping records, per double-entry system rules.

Why the others are wrong:

• B: It only checks mathematical balance, not proving all ledger entries are error-free (e.g., errors of principle may not show).
• C: It misses non-arithmetical errors like omissions or wrong account postings.
• D: It covers all trial balance errors, not just ledger ones, but doesn't reveal conceptual mistakes.

Final answer: A