Tral balance

This query is : Open

Share Report Follow Query Ask a Query

Querist : Anonymous

Querist : Anonymous (Querist)

13 January 2014 WHAT ARE THE REASON TO PREPARE TRAL BALANCE.
WHAT ARE THE FUNCTION OF TRAL BALANCE

Hitendra Jain

Hitendra Jain (Expert)
Follow

14 January 2014 Accounting is a systematic process.
Result of Financial Operation / Venture can only be draw while
1) result of operation during certain period
2) State of liabilities and assets on that date
can be determine.
With journal entries book keeping process is concluded and from ledger posting accounting process begins.

After completion of ledger posting balance of each ledger is determine.

These balances are arrange with a scheme so that total of both side should be match.

Reason to prepare trial balance is to ensure that
1) all ledger posting has been made.
2) accounting entries is made as per correct accounting procedure (subject to some exception)
A specific ledger might have lot of accounting entries which required to be summarized.

Function of trial balance are
1) reveal the ledgers which have no closing balance but have transactions during the period.
2) to assist in preparation of final accounts viz. Profit and Loss account and Balance Sheet.
3) to help in determine nature of ledger and transactions related thereto.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now