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Companies may prepare a trial balance at any time.

A. True
B. False

1 Answer

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Final answer:

The statement that companies can prepare a trial balance at any time is true. A trial balance ensures the mathematical accuracy of the bookkeeping entries and can be used for internal management purposes, irrespective of the accounting period.

Step-by-step explanation:

The statement "Companies may prepare a trial balance at any time" is True. A trial balance is a worksheet where the balances of all ledgers are compiled into debit and credit account column totals that are equal. Companies typically prepare a trial balance at the end of an accounting period to ensure that the entries in the company's bookkeeping system are mathematically correct.

However, they can prepare a trial balance at any point to verify that the ledger balances are accurate, making it useful for internal management purposes. For example, if a company is considering a significant financial decision, it may want to review a current trial balance to understand its financial position more accurately.

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