Trial Balance

 Methods of preparing Trial Balance

There are three method of preparing trial Balance. The total of both the debit and credit column the trial balance must be equal in all the method. The following methods can be used for preparing balance:

1. Balance method

2. Total method

3. Total and Balance method.

1. Balance Method: Trial balance, as its name itself points out is prepared with the balance of ledger accounts. Every ledger account has got the debit and credit side. At the end of a certain period, ledger accounts are balanced excess of the total of the debit side of an account over its credit side is known as debit balance and written in the debit column of the trial balance. In the same way, excess of credit side of an account over its debit side shows credit balance and will be written at he credit side of the trial balance. The total of both the debit and credit side must be equal.

2. Total and Balance Method: According to this method, the total of the debit and credit side of every account is separately written in the debit and credit column of the trial balance. The total of both the debit and credit must be equal. If it is not equal, there are definitely certain errors which should be located and rectified.

3. Total and Balance Method: This method presents both the balance and total method in the same trial balance. The amount column is divided between total and balance method. Each method has further two column of debit and credit. The total of the debit and credit under each method must be equal. There will be different totals according to the different methods but the total of debit and credit of each method will be equal.