Basic Accounting Unit 2 Trial Balance
Trial Balance 1. Meaning of Trial Balance A Trial Balance is a statement that contains the debit and credit balances of all ledger accounts prepared on a particular date. It is prepared to check the arithmetical accuracy of the books of accounts. In simple words, a Trial Balance is a statement that shows whether the total of debit balances is equal to the total of credit balances. Definition: Trial Balance is a statement prepared by listing the debit and credit balances of ledger accounts to check the arithmetical accuracy of accounting records. Example Suppose a business has the following ledger balances: Account Debit ₹ Credit ₹ Cash 20,000 Purchases 15,000 Furniture 10,000 Capital 30,000 Sales 15,000 Total 45,000 45,000 Since the debit and credit totals are equal, the Trial Balance agrees. 2. Objectives of Trial Balance The main objectives of preparing a Trial Ba...