Method of making trail balance
(1) Total method- In this method in the column of debit amount the total of debit of all accounts is written. In the same way in the column of credit amount the total of credit of all accounts is written. In this way both the columns of amount are filled.
(2) Balance method-In it only one column of amount is filled after getting the difference of credit and debit of each column. In the column of debit amount the balances of debit is written and in the column of credit amount the balances of credit is written.
(3) Total and balance method-In it two extra columns of amount are made. A trial balance is prepared executing both the methods shown above.
(4) Omitting Accounts of Equal Totals-In this method such columns are left totally whose totals of debit and credit side are equal because it does not affect trial balance.
Preparation of Trial Balance by Balance Method
Among the above given four methods the most applicable method is balance method. While making trial balance by this method, these things are taken care then it will be easy to prepare trial balance-
(A) Balance, which are always debit balance- Some balances which are always written in debit side are as follows-
1.The assets written in the assets side of balance sheet,as-building, furniture, machine, cash, bank, debtors, bills receivable, etc.
2.Opening stock, purchases and all the expenses and losses written in the trading and profit and loss account.
3.Sales Return accounts
(B) Balances which are always credit balance-
The items written in, the liability side of balance sheet, as-capital creditors, bills payable, bank loan, bank over drafts etc.
Sales account, purchases return account, Reserve
for doubtful debts account and the accounts of profit or accounts of items related to income, etc.
(C) The accounts whose balance may be both debit and credit-
1. Interest account
With these accounts debit or credit word is written in questions. If it is written so then these accounts are recorded in debit or credit according to written instruction. If nothing is written there then considering it as expenditure it is written in debit side.