Ankit Lal Karn ACW Accounts At Edumarz
Till now, we have learned how transactions are entered in a journal and other
Subsidiary book.
We also know how to post these transactions into the ledger from the journal.
This is a continuous process that is carried out throughout the year.
But users of the financial statement also to be assured of the arithmetic accuracy of such accounts.
This can be assured by preparing trial balances.
A trial balance is a statement that contains the closing balances of ledger accounts. It has debit and credit columns.
Assets, expenses & losses are recorded on the debit side
While profit, liability & capital is recorded on the credit side.
The Debit side of the trial balance must match with the credit side.
If the two side does not tally it implies that there is some error in books of accounts.