An adjusted trial balance is a list of all account balances prepared after adjusting entries have been recorded at the end of an accounting period.

Simple Meaning:

It is the final trial balance prepared after updating accounts for items like accrued expenses, prepaid expenses, depreciation, etc.

Purpose:

To ensure total debits equal total credits

To prepare financial statements (Trading Account, Profit & Loss Account, Balance Sheet)

Example of Adjustments:

Outstanding expenses

Accrued income

Depreciation

Prepaid expenses

In short, an adjusted trial balance shows the correct account balances after making necessary year-end adjustments.