Trial Balance. The information for ledgers comes from balance sheets. -This means it is already in balance. As you make changes to the Ledger, it is possible.

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Presentation transcript:

Trial Balance

The information for ledgers comes from balance sheets. -This means it is already in balance. As you make changes to the Ledger, it is possible that mistakes are made. To see if you made any mistakes, you should use a Trial Balance.

Trial Balance Add up all of the debit and credit balances. If they agree, the ledger is in balance. If they DO NOT agree, the ledger is out of balance.

Trial Balance

How to Take a Trial Balance

Trial Balance Using a calculator: -Add up the debits and subtract the credits. If the calculator says 0, the ledger is in balance. -If the calculator does not have 0 on it, the ledger is out of balance.

Importance of the Trial Balance Trial Balances are important. Mistakes should be identified early. Accountants should make sure that their ledger is always in balance. Computers help with this.

Trial Balance out of Balance What happens if the Trial Balance becomes out of balance? If it is not in balance, there is at least one error. -Account identified wrongly, -Addition or subtraction done wrong, -Missing a step.