PREPARATION OF TRIAL BALANCE

Ankit Lal Karn  ACW Accounts At Edumarz 

A trial balance can be prepared in the following ways:-

1. TOTAL METHOD

2. BALANCE METHOD

3. TOTAL-CUM-BALANCE METHOD

Let us learn these methods one by one.

• TOTAL METHOD:-

• Total of debit and credit side is done separately 

• Only the sum total of the debit and credit side of the trial balance is written in the respective column.

• The debit side must get tallied with another and vice-versa.

• This method is not widely used.

• Generally, this method is not helpful in ascertaining the accuracy of financial statements.

• BALANCE METHOD:-

• This method is widely used in the business world.

• All the account balances are shown in the trial balance itself.

• Sum total of each individual column is also written here only.

• In place of the individual debtor and creditor accounts, sundry debtor and creditors are shown. 

•    TOTAL-CUM-BALANCE METHOD- 

• This is a combination of both totals and balance method

• Under this 4 columns are prepared.

• 2 column for writing debit and credit of various accounts.

• And 2 columns are for the total of these accounts.