Coupon Accepted Successfully!


Balances Method

This is the most widely used method in practice. In this method trial balance is prepared by showing the balances of all ledger accounts and then totaling up the debit and credit columns of the trial balance to assure their correctness. The account balances are used because the balance shows the net effect of all transactions relating to an account and helps in preparing the financial statements. It may be noted that in trial balance, normally in place of balances in individual accounts of the debtors, a figure of sundry debtors is shown, and in place of individual accounts of creditors, a figure of sundry creditors is shown.

Test Your Skills Now!
Take a Quiz now
Reviewer Name