What are the rules of trial balance? (2024)

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Advantages of Trial Balance

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The rules for preparing a trial balance are as follows:
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All the assets must be recorded on the debit side
All the liabilities must be recorded on the credit side
All incomes or gains must be recorded on the credit side.
All the expenses must be recorded on the debit side.
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MCQs on Trial Balance
Difference Between Trial Balance and Balance Sheet
How to Prepare Trial Balance
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What is a Trial Balance?

State true or false:

1) A Trial balance is an account.
2) A Trial balance is helpful for preparation of final accounts.
3) A Trial balance is most important document.
4) A Trial balance may be prepared on any date.
5) In Trial balance opening stock is recorded in credit balance column.
6) Both sides total of an account are taken in Gross Trial Balance.
7) Purchase account always shows debit balance.
8) A Trial balance is a List of Ledger balances.
9) A Trial balance does not ensure accounting accuracy.
10) A Trial balance shows only arithmetical accuracy.

An inexperienced Accountant has prepared the following Trial Balance as you are expert in Accountancy find out errors and redraft the Trial Balance.

Trial Balance as on 30th March, 2002
Particulars	L.F.	Debit balance Amount Rs	Credit balance Amount Rs
Opening Stock		10,000
Purchases		40,000
Sales			50,000
Machinery			50,000
Goodwill		50,000
Wages			200
Commission Received		500
Sundry Debtors		40,000
Sundry Creditors			20,500
Bills Payable		50,000
Postage & Telegrams		500
Interest received		200
Capital			70,000
Commission allowed			500
		1,91,200	1,91,200

Q. What are the methods of preparing Trial Balance?

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Heads of Accounts	Dr. (₹)	Cr. (₹)
Cost of Goods Sold	1,50,000	...
Closing Stock	...	40,000
Debtors	...	60,000
Creditors	...	30,000
Fixed Assets	50,000	...
Opening Stock	60,000	...
Expenses	...	20,000
Sales	...	2,00,000
Capital	90,000	...

Total	3,50,000	3,50,000