Distinction/Difference Between Trial Balance and Balance Sheet
Distinction/Difference Between Trial Balance and Balance Sheet:
Learning Objectives:
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What is the difference between trial balance and balance sheet?
The following are the points of distinction/difference between trial balance and balance sheet:
Trial Balance |
Balance Sheet | ||
► | It is a list of balance extracted from the ledger accounts |
► | It is a statement of assets and liabilities |
► | It contains the balance of all accounts – real, nominal and personal. | ► | It contains the balance of only those accounts which represents assets and liabilities. |
► | It is prepared before the preparation of trading and profit and loss account. |
► | It is prepared after the preparation of trading and profit and loss account. |
► | It does not contain the value of the closing stock of goods. |
► | It contains the value of closing stock, which appears on the assets side. |
► | Expenses due but not paid and incomes due but not received do not appear in the trial balance | ► | Expenses due but not paid appear on the liability side and income due but not received appear on the asset side of the balance sheet. |
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