What is the post-closing trial balance used for?

What is the post-closing trial balance used for?

• A. Confirms the balances of all accounts for the period.
• B. Lists only permanent accounts to verify balances and ensure debits equal credits.
• C. Lists only temporary accounts for year-end adjustments.
• D. Is prepared before closing entries.

Answer: (B)

After closing entries are posted, the post-closing trial balance lists only permanent accounts—assets, liabilities, and equity—and shows their ending balances. This provides a final check that the ledger is in balance for the new accounting period and that all temporary accounts (revenues, expenses, dividends) have been closed to zero. Since those temporary accounts are closed into equity (like retained earnings), they no longer carry balances, so they don’t appear on this trial balance. The goal is to confirm that debits equal credits for the remaining accounts and to have a clean starting point for the next period. It isn’t prepared before closing entries, and it doesn’t include only temporary accounts or focus on year-end adjustments.

After closing entries are posted, the post-closing trial balance lists only permanent accounts—assets, liabilities, and equity—and shows their ending balances. This provides a final check that the ledger is in balance for the new accounting period and that all temporary accounts (revenues, expenses, dividends) have been closed to zero. Since those temporary accounts are closed into equity (like retained earnings), they no longer carry balances, so they don’t appear on this trial balance. The goal is to confirm that debits equal credits for the remaining accounts and to have a clean starting point for the next period. It isn’t prepared before closing entries, and it doesn’t include only temporary accounts or focus on year-end adjustments.