High School

Prepare trial balance of Sheshadri from the following balances as on 31-12-2016.

| Particulars | ₹ | Particulars | ₹ |
|---|---|---|---|
| Opening stock | 10000 | Purchases | 20000 |
| Sales | 30000 | Debtors | 20000 |
| Creditors | 10000 | Salaries | 5000 |
| Cash | 10000 | Capital | 25000 |

[Ans. ₹ 65000]

Answer :

To prepare a trial balance, we need to list all the account balances from Sheshadri's business as either debits or credits. The trial balance helps to ensure that debits equal credits in the double-entry bookkeeping system. Let's compile the trial balance step by step.

Trial Balance as on 31-12-2016

Debits:

  1. Opening Stock: ₹10,000

  2. Purchases: ₹20,000

  3. Debtors: ₹20,000

  4. Salaries: ₹5,000

  5. Cash: ₹10,000

Total Debits: ₹65,000

Credits:

  1. Sales: ₹30,000

  2. Creditors: ₹10,000

  3. Capital: ₹25,000

Total Credits: ₹65,000

In a trial balance, the total of debit balances should equal the total of credit balances. For Sheshadri's business, both the debit and credit sides sum to ₹65,000, indicating that the books are balanced.

If any discrepancies were found (which, in this case, there aren't), it would indicate errors in ledger entries or calculations would need to be investigated. The trial balance thus acts as an essential check on the accuracy of financial records.