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Trail Balance
Trail Balance Features
  • It is a list of debit and credit balance drawn from ledger
  • It includes cash and bank balance
  • Its main purpose is to establish arithmetical accuracy of transactions recorded in the books of account
  • It is usually prepared at the end of the year but it can also be prepared any time, as and when required e.g monthly,quarterly or half yearly
  • Its enables the trader to know amounts receivable from customers and amounts payable to suppliers.
  • Its facilities preparation of final accounts

Two type of trial balance

1. Gross trial balance
2. Net trail balance

1. Gross trail balance
  • Take total of debit and credit columns of each ledger account
  • Take totals of receipts and payment of cashbook showing separately cash, bank , and discount columns
  • Write names of all accounts as per the ledger and cash and discount accounts as per cash book into a statement
  • Enter the debit and credit and credit columns
  • Finally take total of debit and credit columns

2. Net trail balance

Under this trail balance , net balance of each account are drawn and shown in trail balance. if debit total of an account is more, it will show debit balance and if credit balance total is an account is more, it will show a credit balance

Important notes :
While preparing a trial balance , we must remember that : assets and expenses account show debit balances.
Income and liabilities account shows credit balances.

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