Accounting 101: How to prepare a trial balance sheet
A trial balance sheet provides an easy way of getting a broad overview of your company’s finances. This internal document lists all of your accounts in a general ledger, which functions as your company’s balance sheet and income statement. The function of a trial balance is to ensure that your debit and credit balances are correct. At QuickBooks, we know that running a company can be exhausting and what spare time you have shouldn’t be spent worrying about correcting errors in your accounts.
QuickBooks accounting software allows you to take control of your company’s bookkeeping, whether you run a small or medium-sized company. Without the necessary skills, accounting isn’t the easiest practice to understand, but hiring an accountant to manage your company’s finances can be costly. Instead of hiring an accountant for your business, we recommend that you to use QuickBooks accounting software. Manage your company’s trial balance sheet and other financial statements easily with QuickBooks accounting software.
A step-by-step method to construct a trial balance sheet
The following are pointers on how to prepare an effective trial balance sheet:
- Keep a record of all your transactions as they occur so that all of your paper work is organised, easy to access and logical to find.
- Decide on what your company’s debits are. These include expenses, assets, cash on hand, your company’s inventory and depreciation of your vehicles and buildings (depreciation). These debits will appear on the left-hand side of your company’s trial balance sheet.
- List your company’s credits, these includes liabilities and equity. Liabilities are different from expenses as they’re the expenses a company has yet to pay.
- Sort your transactions in categories. Keep the categories to a minimum to ensure that there is no confusion. List the category headings in bold along the far left side of the sheet, with titles for the transactions under each category.
- Your second column should contain your company’s debit amounts, whereas the credit amounts should appear in a third column. Remember that the debit amounts are negative.
You don’t need to struggle with your trial balance sheet if your company can’t afford to hire an accountant to manage its books. QuickBooks accounting software offers a simple solution to keep record of your business’s ongoing transactions. Browse our packages, including our SimpleStart, Pro and Premier programs, to make managing your accounts easy, or contact us now for more information.