The Trial Balance (Junior Cert Business Studies): Flashcards

Trial balance definition

List of balances from general ledger & analysed cash book

Trial balance step in accounting process

Third step

Trial balance structure

Three columns: Details, Dr, Cr

Where debit balances go in trial balance

Debit column

Where credit balances go in trial balance

Credit column

Three reasons for preparing trial balance

Error detection, verification, foundation for statements

Bank balance in trial balance?

Included from analysed cash book (not in ledger)

What 'extracting' a trial balance means

Taking balances from ledger & listing in trial balance format

What equal trial balance columns indicate

Double-entry bookkeeping done correctly

Example of mathematical error in trial balance

Adding up figures incorrectly when calculating balances

Wrong side placement error

Putting debit in credit column or vice versa

Missing balances error

Forgetting to include an account balance

Debit bank balance meaning

Positive balance - money in the bank

Credit bank balance meaning

Negative balance - overdraft situation

Three fundamental accounting steps

1. Cash book 2. Post to ledger 3. Extract trial balance