Trial balance, daybooks and cash books

MN10668 lec 3

Trial balance; Daybooks and cash book




c/d – carried down
b/d – brought down

balancing different types of accounts
- If the account is a movement in owners’ capital account then it is balanced off to the
capital account
- If the account is a revenue (income) account, the balance is transferred to the
income statement account
- If the account is an asset, liability, or capital account the balance carries forward into
the new period

, The nature of a trial balance
- A trial balance is a list of the balances in the ledger at the end of an accounting
period, divided between those accounts with debit balances and those with credit
balances
- Since every transaction recorded in the ledger consists of both a debit and credit
entry, the total of those accounts in the trial balance with debit balances should
equal the total of those with credit balances




Bank with credit balance? – overdraft
Sales is an income so credit
Same with capital
Van non-current asset – debit
Motor expenses have to pay from the bank so debit
Pig ltd – customers who have bought goods on receivables therefore debit
Greens garage – trade payable


Assets expenses and drawings account tend to have a debit balance
Liability income and equity accounts tend to have a credit balance



\