Question

State the limitations of trial balance?

for mods/ stars/ TakenName etc​

Answer 1

Limitations of Trial Balance

As we saw the trial balance is an important account for bookkeepers. But there are some limitations of a trial balance as well. One main limitation is that it does not point out all types of errors. This means that even if we have a fully balanced trial balance it will not assure 100% accuracy of the accounts. There are many types of errors a trial balance does not draw attention too. Some such errors are

A transaction that is completely missing, was not even journalized

When the wrong amount was written in both the accounts

If a posting was done in the wrong account but in the right amount

An entry that was never posted in the ledger altogether

Double posting of entry by mistake

Hope this helps you!

#BE ẞRAINLY :-)