Making a Balance Sheet

0
82

Making a Balance Sheet

Train Station, Adult, City, Indoors, Man

A trial balance is a collection of active accounts and their balance values. The contents of the trial balance serve as evidence that the debit and credit side are the same and not one-sided.

In preparing a trial balance, you only need to copy the balance value of each account in the ledger. Although it’s fairly easy, you need to calculate the amount of balance in the ledger, so the process of preparing a trial balance can be easier and less error-free.

Create an Adjustment Journal and Post it to the Big Book
If there is a mistake in the journaling or posting process, you need to keep an adjusting entry. An adjustment journal also needs to be made to ensure that all costs and income have been recorded in the right period or time period.

Generally, there are several points or verses in the adjusting entry. The first verse in the adjusting entry is error correction in the journalizing process. After that, you also need to record depreciation on fixed assets.

It is also important to note the adjustment of rent paid at the beginning or down payment to the rental expense. Usually, these changes are suspected to have benefits that have been used or exceeded.

The next verse in the adjusting entry is the equipment that is changed to the equipment load. This change is usually caused by equipment that has been used up.

Next, you also need to check the revenue that is earned at the beginning which is then eliminated into service or service revenue. You can do this recording by adjusting the products or services sold.

You keep doing the recording in this adjusting journal until all errors or things you want to make sure have been revised. That way, you can record an adjustment journal without errors in the ledger.

Rearrangement in Post Balance Trial Making Adjustment Journal
After keeping an adjusting entry, you also need to adjust the contents of the trial balance. This is because the adjusted trial balance will be used as a source of initial data for financial statement preparation activities.

When making adjustments to the paragraph in the adjusting entry, the accounts that are experiencing an adjustment must have a changed value. This is why the value of the balance in the trial balance needs to be re-adjusted with data in accordance with the adjusting entry.

No need to be too complicated, adjustments to your balance sheet can be directly summed or subtracted by the value or nominal in the account in question. That way, the value of the balance on the trial balance becomes more accurate.

LEAVE A REPLY

Please enter your comment!
Please enter your name here