TRIAL BALANCE. The Trial Balance is taken to ascertain whether the Journal entries have been correctly transferred to the Ledger, and may be made as follows:-1st. Rule a sheet of paper with double money columns, and head it "Trial Balance," with Dr. over the left, and Cr. over the right hand money columns. 2d. Write the names of the Ledger accounts in the open space at the left, and, after adding the two sides of each account, place the amount of the Dr. side in the Dr. column, and the Cr. side in the Cr. column, opposite the name thus written. 3d. Add the Dr. and Cr. columns of the Trial Balance, and if they foot alike, the books are supposed to be correctly posted. This proof should be taken as often as once a month. BALANCE SHEET. Merchants as often as once, and sometimes twice, a year balance their Ledgers, and make out what is termed a Balance Sheet. This sheet exhibits, in a condensed form, a statement of their mercantile affairs, and forms the materials for opening a new set of books, containing on the Dr. side the debts due them, cash on hand, and the value of merchandise or other property remaining unsold; and on the Cr. side, the amount of their indebtedness to others. The difference between the two sides is of course their net capital. Balance, in book-keeping, is the difference between the sums of the Dr. and Cr. sides of an account; and when that difference is placed on the deficient side, the account is said to be balanced-that is, the Dr. and Cr. sides are made equal; and when a single horizontal line is drawn across the money columns, and the sum total set down under each, and double parallel lines drawn under these sums, the account is said to be closed; and when the several accounts of the Ledger are thus made equal, and the lines drawn and sums set down as above described, and the balances transferred to the Balance Sheet, the Ledger is said to be balanced and closed. |