Which account would most likely appear on an adjusted trial balance but probably would not appear on the trial balance?

• A. Interest Income
• B. Cash
• C. Depreciation Expense
• D. Prepaid Insurance

Answer: (C)

End-of-period adjustments allocate the cost of using long-term assets over their useful life. Depreciation expense is recognized through an adjusting entry that debits Depreciation Expense and credits Accumulated Depreciation. This increases the expenses on the income statement and reduces the net book value of assets on the balance sheet, without involving a cash outflow at the moment of adjustment. Because this expense is not recorded until the adjusting entry is made, it would appear on the adjusted trial balance but would probably not appear on the unadjusted trial balance. In contrast, Cash and Prepaid Insurance are assets that typically appear in both balances (Prepaid Insurance is later expensed as the asset is used), and Interest Income is a revenue item that can be recorded before adjustments, so it would often show up on the initial trial balance as well. Depreciation expense best fits the scenario because it is specifically tied to the end-of-period adjustments.