Formation of Trial Balance from Ledger - JSS3 Business studies Lesson Note
To form a trial balance, follow these steps:
- List all Ledger Accounts: Identify and list down all ledger accounts with their balances.
- Classify Balances: Group the balances into debit and credit columns.
- Total Debits and Credits: Calculate the total debits and total credits.
- Verify Equality: Ensure that the total debits equal the total credits.
Example: Suppose we have the following ledger accounts with balances:
|
Account |
Debit (₦)
Credit (₦)
Cash
5,000
Accounts Receivable
3,000
Inventory
8,000
Accounts Payable
4,000
Owner's Capital
10,000
The trial balance would be:
|
Account |
Debit (₦)
Credit (₦)
Cash
5,000
Accounts Receivable
3,000
Inventory
8,000
Accounts Payable
4,000
Owner's Capital
10,000
Total
16,000
14,000