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Trial Balance Lesson Notes

Here are the steps to record the transactions and prepare a trial balance for PBX Enterprise for May 2020: 1. Record the transactions in the appropriate book of original entry (cash book, purchases book, sales book or journal) with narrative, folio references, debits and credits. 2. Post the transactions from the books of original entry to the relevant ledger accounts. 3. Extract the balances of all the ledger accounts. 4. Prepare a trial balance with the balances of all ledger accounts listed and total the debit and credit columns to prove they are equal. This will provide an accurate summary of the financial position of PBX Enterprise at the end of May 2020 based on the transactions recorded. Let me know if

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Jada Thompson
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373 views16 pages

Trial Balance Lesson Notes

Here are the steps to record the transactions and prepare a trial balance for PBX Enterprise for May 2020: 1. Record the transactions in the appropriate book of original entry (cash book, purchases book, sales book or journal) with narrative, folio references, debits and credits. 2. Post the transactions from the books of original entry to the relevant ledger accounts. 3. Extract the balances of all the ledger accounts. 4. Prepare a trial balance with the balances of all ledger accounts listed and total the debit and credit columns to prove they are equal. This will provide an accurate summary of the financial position of PBX Enterprise at the end of May 2020 based on the transactions recorded. Let me know if

Uploaded by

Jada Thompson
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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NAME : HAYDEN MAHADEO

CLASS                                       : FORM 3.1/3.3               SCHOOL                                   :


SAN-FERNANDO CENTRAL SECONDARY

SUBJECT : PRINCIPLES OF ACCOUNTS UNIT PLAN SECTION


4 : LEDGERS AND TRIAL BALANCE

TOPIC : THE TRIAL BALANCE


• STUDENTS WILL BE ABLE TO EXPLAIN THE PURPOSES OF A TRIAL BALANCE.

• STUDENTS WILL BE ABLE TO ANALYZE THE LEDGER ACCOUNTS AND PREPARE A


TRIAL BALANCE.

• STUDENTS WILL BE ABLE TO VALUE THE TERM ‘BALANCE’ IN THEIR DAILY LIVES
WHAT IS A TRIAL BALANCE?

• IT IS PREPARE AT THE END OF AN ACCOUNTING PERIOD

• IT IS A LIST OF ACCOUNTS IN THE ORDER IN WHICH THEY APPEAR IN THE LEDGER 

• DEBIT BALANCES APPEAR IN THE LEFT COLUMN

• CREDIT BALANCES APPEAR IN THE RIGHT COLUMN


WHAT IS A TRIAL BALANCE?

• A TRIAL BALANCE IS A LIST OF CLOSING BALANCES OF LEDGER ACCOUNTS


ON CERTAIN DATES
• IS THE FIRST STEP IN THE PREPARATION OF FINANCIAL STATEMENTS (PROFIT
AND LOSS STATEMENT & THE BALANCE SHEET)
• IT UNCOVER ERRORS IN JOURNALIZING AND POSTING
• IT PROVES THE MATHEMATICAL EQUALITY OF DEBITS AND CREDITS AFTER
POSTING(IN THE DOUBLE ENTRY ACCOUNTING-EQUALITY OCCURS WHEN THE SUM OF
THE DEBIT ACCOUNT BALANCES EQUALS THE SUM OF THE CREDIT ACCOUNT BALANCES)
THE STEPS FOR PREPARING A TRIAL
BALANCE
• LIST THE ACCOUNT TITLES AND THEIR BALANCES IN THE APPROPRIATE
DEBIT OR CREDIT COLUMN.
• TOTAL THE DEBIT AND CREDIT COLUMNS.
• PROVE THE EQUALITY OF THE TWO COLUMNS.

Sunrise Store
Trial Balance
December 31 2020
Account Titles Debit Credit
$ $

TOTAL
LETS RECALL
THE ACRONYMS
D E A L C L I P P
• D • C

• E • L

• A • I

• L • P
ACCOUNTS HAVE • P ACCOUNTS
_______ BALANCES HAVE ________ BALANCES
ACRONYM
D E A L C L I P P
• D - DEBTORS • C – CREDITORS

• E - EXPENSES • L – LIABILITIES

• A - ASSETS • I - INCOME

• L - LOSSES • P – PROVISIONS
• P - PROFITS
ACCOUNTS HAVE DEBIT BALANCES ACCOUNTS HAVE CREDIT BALANCES
APPLICATION ACTIVITY

POSTING TRANSACTIONS IN LEDGER AND PREPARING TRIAL BALANCE

RUBRIC FOR PREPARING TRIAL BALANCE

CATEGORY MASTERY EXCEEDED ATTAINED UNATTAINED


20 (MARKS) 15 (15 MARKS) 10 (MARKS) 5 (MARKS)
Prepare the Correctly Prepared trial Prepared trial Prepared trial
trial balance prepared trial balance and balance and balance and
and summarize balance and totaled with 80% totaled with totaled with less
correctly totaled with - 89% accuracy 70% - 79% than 70%
90% - 100% accuracy accuracy
accuracy
Group Activity: Balancing Off Accounts and the Trial Balance

1. Analyze the following list of balances extracted from the books of Sunrise
Store and prepare a trial balance as at December 31, 2020.
(20 marks)

$
Capital 12,000
Freehold Premises 6,000
Furniture and Fixtures 2,000
Plant & Machinery 1,600
Sales 42,400
Purchases 30,560
Returns Inwards 600
Returns Outwards 280
Discount Received 700
Discount Allowed 960
Wages 5,180
Rates and Insurance 540
Rent Receivable 440
General Expenses 1,300
Creditors 4,896
Debtors 13,680
Cash In Hand 1,248
Bank Overdraft 2,952

2. Why is it important to have a ‘balance’ in our daily lives? (5 marks)


KAHOOT GAME

• PLEASE JOIN AT WWW.KAHOOT.IT


OR WITH THE KAHOOT
APP
THE GAME PIN # IS_____
LET’S SUMMARISE !
Name of Business
Trial Balance
as at 31st December, 2020

Account Titles Debit Credit


$ $
Land 
Accounts receivable 
Purchases 
Carriage Inwards 
Carriage Outwards 
Return Inwards 
Rent 
Salary 
Other Expenses eg loan interest 
Other Fixed Assets 
Bank 
Discount Allowed 
Drawings 
Provision Accounts eg Provision for bad debt; 
provision for depreciation
Bank overdraft 
Loan 
Accounts payable 
Capital 
Revenue accounts eg rent received 
Discount received 
Return outwards 
Sales 
All liabilities 

TOTALS $ $
HOMEWORK POSTED ON TEAMS UNDER THE CHANNEL: INTRODUCTION
TO ACCOUNTING
The following represents the transactions of PBX Enterprise for the month of May 2020:

May 1. M. Gordon, the owner, starts the business with $150,000 in cash.

May 2. Opens a bank account for the business with $100,000 of the cash invested.

May 3. Purchases good by cheque for $75,000.

May 4. Credit purchases: M. Scott - $30,000

L. Binns - $65,000

May 7. Cash sales, $52,000.

May 9. Credit sales: T. King - $44,000

U. Long - $76,000

May 11. Pays wages of $22,000 in cash.

May 14. Pays telephone bill of $4,000 in cash.

May 15. Receives payment by cheque from T. King of $20,000.

May 17. Pays L. Binns $35,000 in cash.

May 18. U. Long pays $56,000 in cash on her account.

May 20. Lodged $60,000 of cash into bank .

May 21. Settles debt with M. Scott by cheque and receives a cash discount of 100%.

May 24. Pays L. Binns $20,000 by cheque.

May 25. Goods returned by U. Long costing $8,000

May 27. T. King is given a cash discount of $5,000

May 28. Cheque payments received: T. King - $14,000

U. Long - $10,000

May 29. Bought motor car on credit from Cars Unlimited for $80,000.

May 30. Pays rent by cheque $35,000.

May 31. Receives interests on bank account, $2,000.

Required: Record these transactions in the appropriate book of original entry of PBX Enterprise and
extract a Trial Balance.

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