A good way to remember what the trial balance does is to remember: a trial balance is similar to a court of law, it puts the accounts on trial to find out if mistakes have been made or to prove their accuracy.
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A trial balance is a list of the balances of each of the accounts in the general ledger and analysed cash book.
A business can record its trial balance manually in a record book, or electronically using accounting software.
The trial balance has only four columns, as shown below. TRIAL BALANCE
Date Details F
Debit €
Credit €
DEBIT AND CREDIT ENTRIES FOR THE TRIAL BALANCE Knowing if an entry goes on the debit or credit side of the trial balance is simple.
• Any balances brought down on the debit side of the general ledger will be recorded on the debit side of the trial balance.
• Any balances brought down on the credit side of the general ledger will be recorded on the credit side of the trial balance.
For example, the balance brought down (b/d) in the purchases account is on the debit side of the general ledger, which means it is recorded on the debit side of the trial balance. And the balance brought down (b/d) in the sales account is on the credit side of the general ledger, which means it is recorded on the credit side of the trial balance.
Recording Bank Entries in the Trial Balance
We noted earlier that the bank balance from the analysed cash book does not need to be posted to the general ledger. However, the bank balance does have to be included in the trial balance.
It is the balance in the bank at the end of the period that is transferred to the trial balance. The bank balance could be a debit or credit balance.
