U2 L4-Trial Balance - Trial Balance After a number of...

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Trial Balance After a number of transactions are recorded in a company's ledger, it is important to find the balances in each account in the ledger, and to ensure that the ledger is in balance (debits = credits) before creating financial statements at the end of the period. An account in the ledger, after a number of transactions have been recorded into it may look like this: Bank Bank has been increased (debited) by $1,000, $90, and $500, and has been decreased (credited) by $200 and $80. At any given point, it may be necessary to determine the account balance. To calculate an account balance, complete the following steps: Step 1 : Total the debit column. Step 2: Total the credit column. Step 3: Subtract the smaller value from the larger value and place the difference below the larger of the two totals. See the total of the Bank account calculated below. Bank The circled amount is the dollar value of the account. The side on which it is recorded, indicates the type of balance it is, either a debit (left) or credit (right). An account
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balance tells you the dollar value of an account, and whether the value is a debit or credit.
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This note was uploaded on 07/15/2011 for the course AFM 102 taught by Professor Aa during the Summer '07 term at Court Reporting Institute of Dallas.

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U2 L4-Trial Balance - Trial Balance After a number of...

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