How a trial balance is extracted from a set of accounting records

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How a trial balance is extracted from a set of accounting records

A trial balance is a list of the names and balances of all the accounts showing in the ledger including cash and bank balances from the cash book. A trial balance checks to see if the debit equals the credit. If debit total is not same as the credit total then the records don’t balance and there must be a mistake. Debit accounts include asset, expense accounts and credit accounts include liability, equity, revenue accounts. Assets are listed first followed by liabilities and then owner's equity. 

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The Trial Balance can be taken at any point in time. It lists all ledger accounts and their balances and is used to see if debit and credit balance. Assets are listed first followed by liabilities and then owner's equity. Debit balances are listed in the left side and credit balances in the right side.

The Trial Balance is a list of all the ledger accounts. You have to list all your total debits and credits from each general ledger account. There should be three columns and they should be account name, debit and credit. For each account you have ...

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