trial balance

Debits equal credits?

A trial balance is a bookkeeping worksheet listing all accounts in a ledger with their debit or credit balances.

If the columns don't match, there's an error somewhere in the books.

The trial balance verifies arithmetic accuracy but won't catch every mistake—an entry posted to the wrong account won't show up: Run a trial balance before closing the month.

verification

ledger

Financial record book

debitsRecorded account reductions
creditsUnits toward graduation
accountsRecords of transactions

equilibrium · double-entry · bookkeeper · tally · totals · adjustments · posting · general ledger · arithmetical · calculations

accounting

journal

Record of daily events

entriesItems logged or submitted
chart of accountsCategorized ledger structure
fiscal yearAccounting calendar period

accruals · prepayments · assets · liabilities · equity · revenue · expenses · income statement · financial statements · GAAP

audit

verification

Proving something accurate

internal controlsOrganizational oversight procedures
complianceAdhering to requirements
audit trailChronological record of transactions

external auditor · assurance · review · documentation · tick marks · reconciliation · year-end

Opposites

accounting process stage

trial balancefinancial statements

Formal records of transactions

balance sheet · income statement · annual report · profit and loss statement · journal entries

balance state

trial balancediscrepancy

Difference between expected and actual

overspending · variance · underspending · imbalance

Family

balance, trial, unbalanced, imbalance, balancing, balances, unbalance, counterbalance, imbalances

Familiarity: Top 500,000
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