If total debits do not equal total credits on a trial balance, what is the usual next step?

If total debits do not equal total credits on a trial balance, what is the usual next step?

• A. Review postings and correct errors
• B. Prepare the income statement
• C. Close the books
• D. Record cash receipts

Answer: (A)

When a trial balance doesn’t balance, the first step is to review postings and correct errors. The trial balance is used to verify that total debits equal total credits after posting, so any mismatch usually means a posting mistake, a missing entry, a transposition error, or an incorrect amount. Go back to the journal and confirm that each transaction was recorded with the correct debit and credit, then verify that those amounts were posted to the right ledger accounts and that the ledger totals were added correctly. After fixing any mistakes, recompute and run the trial balance again to ensure it now balances. Why the other options aren’t the next step: preparing the income statement relies on balanced accounts to provide accurate results, and closing the books is a later process once balances are correct. Recording cash receipts is a specific entry and won’t fix a systemic mismatch in the trial balance.

When a trial balance doesn’t balance, the first step is to review postings and correct errors. The trial balance is used to verify that total debits equal total credits after posting, so any mismatch usually means a posting mistake, a missing entry, a transposition error, or an incorrect amount. Go back to the journal and confirm that each transaction was recorded with the correct debit and credit, then verify that those amounts were posted to the right ledger accounts and that the ledger totals were added correctly. After fixing any mistakes, recompute and run the trial balance again to ensure it now balances.

Why the other options aren’t the next step: preparing the income statement relies on balanced accounts to provide accurate results, and closing the books is a later process once balances are correct. Recording cash receipts is a specific entry and won’t fix a systemic mismatch in the trial balance.