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.
