What is the procedure for preparing a trial balance?

Definition of a Trial Balance

A trial balance consists of the following information:

  • The title of each general ledger account that has a balance
  • To the right of the account titles are two columns for entering each account's balance. One column is headed Debit and the other column is headed Credit
  • Each account's balance is listed in the appropriate column
  • After all of the account balances are entered, each column is summed
  • The total of the debit column should be equal to the total of the credit column

Example of a Trial Balance

Today's accounting software can print a trial balance at the click of a mouse. Further, a computerized accounting system has eliminated the many math and clerical errors that had occurred with a manual accounting system.

Of course, a trial balance that has the total debits equal to the total credits does not mean that the general ledger is free of errors. For instance, recording a debit entry into the Equipment account instead of recording the debit in the Equipment Repairs Account will not be uncovered by the trial balance.

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