Finding Trial Balance Errors
When preparing a trial balance, the total debits must equal the total credits. Don't be discouraged if they don't. Bookkeeping errors happen. Just think of the trial balance as a tool to find the errors. Use the following steps as a guide to track down the error or errors.
- Be sure the numbers on your trial balance are the same numbers shown in your general ledger. Check to see if you properly classified amounts as debits or credits on your trial balance.
- Go back to your journals (sales and cash receipts journal, cash disbursements journal, and general journal). Check that the journal totals were properly posted to the general ledger. Were the correct amounts posted? Were they properly classified as debits or credits?
- Go back to each journal again. Look at the totals that were posted to the general ledger. Do total debits equal total credits in each journal?
- Go back to each journal again. Did you foot each column on each page of the journal? Did you carry forward all column totals to the next page? Did all the items entered in the "miscellaneous" column get posted to the general ledger?
- Is the difference divisible by nine? If so, it could be a simple transposition error. For example, writing down 540 instead of 450 results in a difference of 90. Writing down 26 instead of 62 results in a difference of 36. Notice that both of these differences are divisible by nine. If the difference between debits and credits is divisible by nine, go back to the journals, looking for the error. Knowing that it may be the result of transposed numbers should help you find it.
- Is the difference between debits and credits 1, 100, 1,000, 10,000, etc.? If so, it is probably an addition or subtraction error.
- Divide the difference by two. Is the resulting number shown on your trial balance? If so, check to see if you have incorrectly classified the amount as a debit or credit.
|
Disclaimer: The material on this site is designed to provide accurate and authoritative information in regard to the subject matter covered. It is distributed with the understanding that the publisher is not engaged in rendering legal, accounting or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. Full Disclaimer |
Small Business Library
Small Business Toolkits
Business Services Directory
The U.S. Chamber’s Small Business Connections directory puts you in touch with leading companies that provide services for businesses like yours.
|
 |
Urge your members of Congress to support the
U.S.-Colombia Trade Promotion Agreement. |
 |
|
 |
|
