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How To prepare The Trial balance and format explain | Adjustment entry

What is Trial Balance ?

A simple explanation for a trial balance is to record the closing balance of a ledger account, Also it contains ledger and adjustment information

Why Need Trial Balance ?

To ensure and verify that all accounts in the ledger are recorded
Government regulations for final account adjustment ☑

Expenditure and income unrelated to the current account year should not be recorded in any company account, and if such expenses and income are recorded in the account, such transactions should be removed from the final account before the Income statement is published.

Company right of final account adjustment ☑

If the expenditure and income relating to the current accounting year have not been recorded in the company's accounts, such expenditure and income should be recorded in the final accounts before the income statement is issued.

how to prepare the Trial Balance ?

It is simple: The closing balance on the debit side of the ledger should be recorded on the debit side of the trial balance and The closing balance on the credit side of the ledger should be recorded on the credit side of the trial balance

A complete clear explanation of How To Record The Adjustment Entry In The Final Account is given on the Adjustment page read now

Example of Trial Balance

investment $23000,purchased the goods $3000 sale the goods $4000.

journal

particular	Debit	Credit
Cash A/C D	23000	-
To Capital A/C C	-	23000
(Capital $ 23000)		-
Purchase A/C D	3000	-
To cash A/C C	-	3000
(Purchase $ 3000)		-

Cash A/C D	4000	-
To sales A/C C	-	4000
(sales $ 4000)		-

Cash A/C
Date	particular	Amount	Date	particular	Amount
Debit			credit
	To capital A/C	23000		By Purchases A/C	3000
	To sales	4000		By balance C/D	26000
		29000			29000

	To balance B/D	26000

Capital A/C
Date	particular	Amount	Date	particular	Amount
Debit			credit
				By cash A/C	23000
	By balance C/D	23000

		23000			23000

				To balance B/D	23000

Purchase A/C
Date	particular	Amount	Date	particular	Amount
Debit			credit
	To Cash A/C	3000		By balance C/D	3000

		3000			3000

	To balance B/D	3000

Sales A/C
Date	particular	Amount	Date	particular	Amount
Debit			credit
				By cash A/C	4000
	By balance C/D	4000

		4000			4000

				To balance B/D	4000

trial balance
particular	Debit	Credit
cash	26000
Capital		25000
purchased	3000
sales		4000
	29000	29000

trial balance format explain

The trial balance format is similar to the nominal account

Nominal Accounts

Debit All Expenses And Losses
Credit All Incomes And Gains

Debit expenses

expenditure ( )

purchased building
purchased machinery
purchased furniture

expenses ()

purchased stationery
rent salary advertisement tax
dividend , interest paid

cost ( )

purchase raw material
factory rent wages maintenance,
transport charges , input charges

Debit losses

loss on sale of asset
Fire loss of goods

credit income other sources of income (show p & L A/C)

interest received
dividend received
commission received
Profit from property sales
rent received

credit gain major sources of income(show trading A/C)

sale of goods and services

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