Question

Statement I: A ledger can be used to identify specific account balances for decision-making.

Statement II: A trial balance is more detailed than a ledger for analysing transactions.

Options

• Only I is correct.

• Only II is correct.

• Both I and II is correct.

• Neither statement is correct.

Answer 1

Only I is correct.

Explanation:

Statement I is correct. A ledger provides detailed information about individual accounts, such as Cash, Sales, Debtors, etc., which helps in identifying specific account balances useful for decision-making.

Statement II is incorrect. A trial balance only shows the final balances of all accounts in a summarised form; it is less detailed than a ledger and is mainly used to check arithmetic accuracy, not to analyse transactions.