Trial Balance:

A trial balance is a statement of debit and credit balances that are extracted from the ledger accounts on a particular date. It is prepared for the purpose of testing the arithmetical accuracy of the books of accounts and to ensure that the transactions are properly recorded under the Double Entry System.

Purpose of preparing the trial balance:

The preparation of a trial balance serves the following purposes:

1. To test the arithmetical accuracy of the books of accounts.

2. To ensure that all transactions have been properly recorded under the Double Entry System.

3. To facilitate the preparation of the final accounts.

Locating Clerical Errors:

The primary purpose of preparing a trial balance is to locate the clerical errors in the books of accounts. Clerical errors may arise due to mistakes made in recording transactions, posting entries to ledger accounts, or balancing ledger accounts.

Examples of clerical errors that can be detected by preparing a trial balance are as follows:

1. Posting errors: Posting the wrong amount to a ledger account.

2. Transposition errors: Transposing digits, such as recording Rs 45 as Rs 54.

3. Omission errors: Failing to record a transaction or posting it to the wrong account.

4. Commission errors: Recording a transaction that should not have been recorded.

5. Compensating errors: Two or more errors that offset each other, resulting in the books of accounts balancing.

Conclusion:

Thus, the preparation of a trial balance is for locating clerical errors in the books of accounts. However, it cannot detect errors of principle or errors of omission. Hence, the correct option is 'C'.