MEANING DEF TRADING A/C P&L ACCOUNT BALANCE SHEET

1. Prof. S.N.Gaikwad
Vice Chairman
Prof.S.R. Tajane
Faculty Member

3. TRIAL BALANCE
Definition:
According to Spicer and Pegler
“ A trial balance is a list of all the balances standing on the
ledger accounts and cash book of the concern at any given
date.”
Thus Trial Balance is a statement of the debit and credit
totals or balances of the ledger arranged in separate
colomns.

4. Format of Trial Balance:
Note: Balances of Debit and Credit side Should be
Equal on a particular date.

5. Objectives of preparing Trial Balance:
1.Testing of arithmetic accuracy
2.Tohelp in preparing Financial statements
3.Helps in locating errors
4.Help in comparison
5.Help in making adjustments.

6. Is the Trial Balance a Conclusive
Proof of Accuracy?
Errors which are not disclosed by Trial Balance:
• Error of omission
• Error in original record
• Errors of Principle
• Compensatory Errors
• Complete reversal Entry

7. Balance of Accounting
The difference of two sides of an account is called balance.

10. Rs. Rs.
Capital 20000 Discount(Dr.) 120
Cash 800 Salaries 1860
Opening stock 3000 Furniture 1100
Commission(Dr.) 250 Wages 4860
Purchases 8900 Sales 20480
Bank 2550 Rent 1260
Drawings 620 Debtors 13520
Trade expenses 2460 Machinery 3300
Creditors 4420 Advertisement 300
Question:
The following balances are extracted from the books of
Mohan Kumar on 31 march, 2010. Prepare a Trial Balance
from these balances.

11. Name of the accounts Dr. Balance Name of the Account Cr. balance
Cash 800 Capital 20000
Commission 250 Sales 20480
Purchases 8900 Creditors 4420
Bank 2550
Drawing 620
Discount 120
Salaries 1860
Furniture 1100
Wages 4860
Rent 1260
Debtors 13520
Trade expenses 2460
Machinery 3300
Advertisement 300
Stock (opening) 3000
44900 44900
Trial Balance as on 31 march, 2010

13. Prof. Satish R. Tajane
(M.Com, GDC&A,CMA-Inter,Ph.D. Appear)
GST & Income Tax
Consultant