What is a Trial Balance?

📚 New! Get my 2nd Edition Accounting Cheat Sheet Bundle → https://accountingstuff.com/shop What is a Trial Balance? A Trial Balance (or TB) is an accounting report that shows a list of all ledger accounts and their balances at a point in time. It's used internally by businesses to check that Total Debits equal Total Credits. What does a Trial Balance look like? We start with a complete list of accounts in the General Ledger. These are usually arranged by type. So we have: - Assets - Liabilities - Equity - Revenue - Expenses Businesses often like to give each account a code to keep things organized. Assets might get the 1s, Liabilities the 2s, Equity the 3s, Revenue the 4s and Expenses the 5s. At this point, we’re basically looking at a Chart of Accounts. To turn it into a Trial Balance, we need the balances. So let's add two more columns. One for Debits and one for Credits. Debits go on the left and credits go on the right. The Trial Balance always has to balance, so the total of the debit column must equal the total of the credit column. 🔴Subscribe for more Accounting Tutorials → https://geni.us/subtothechannel 🔎FAQ ▪ My Favourite Accounting Book for Beginners → http://geni.us/5mKR7m 🔝 CLOUD ACCOUNTING SOFTWARE ▪ XERO (Free Trial / Discount) → https://xero5440.partnerlinks.io/08mfchsgfw8z ▪ QuickBooks Online USA (Free Trial / Discount) → https://geni.us/quickbooksonlineusa ▪ QuickBooks Online Canada (Free Trial / Discount) → https://geni.us/quickbooksonlinecanada 🚶FOLLOW ME ON ▪ Instagram → https://www.instagram.com/accountingstuff ▪ TikTok → https://www.tiktok.com/@accounting_stuff ▪ Facebook → https://www.facebook.com/accountingstuff/ ________________________ DISCLAIMER Some of the links above are affiliate links, where I earn a small commission if you click on the link and purchase an item. You are not obligated to do so, but it does help fund these videos in hopes of bringing value to you! ________________________ #accounting #accountingbasics #accountingstuff