A trial balance is a list of all the general ledger accounts (both revenue and capital) contained in the ledger of a business. This list will contain the name of each nominal account and the value of that nominal ledger balance. A trial balance only checks the sum of debits against the sum of credits. That is why it does not guarantee that there are no errors. The purpose of a trial balance is to prove that the value of all the debit value balances equals the total of all the credit value balances. A profit and loss account (also referred to as P&L or a profit and loss statement) provides you with an overview of your company’s revenue and expenses over a given period of time. A balance sheet is a summary of all of your business assets (what the business owns) and liabilities (what the business owes). At any particular moment, it shows you how much money you would have left over if you sold all your assets and paid off all your debts (i.e. it also shows 'owner's equity').

Saket Kumar

116 resources

0

3

1

Like