What is difference between trail balance and balance sheet?

Banking & FinanceManagementCompanies/Organisations

The major differences between the trial balance and balance sheet are as follows −

Trail balanceBalance sheet
  • Opening stock is considered.

  • Debit and credit.

  • Doesn’t take part in financial statement.

  • Contains nominal, real and personal accounts.

  • Internal use

  • Can be prepared monthly, quarterly, half-yearly and financial period.

  • Prepared in column format.

  • Audit is not necessary.

  • Information of loss or profit is not provided.

  • Not necessary to prepared by law.

  • Prepared before adjustments.

  • Can’t tell true financial position of the firm.

  • General ledger is the source.

  • No thumb rule.

  • Closing stock is considered.

  • Assets and liabilities.

  • Will take part in financial statement.

  • Contains real and personal accounts.

  • External use.

  • Prepared in financial period.

  • Prepared in T-Format.

  • Audit is necessary.

  • Information on loss/profit is provided.

  • Prepared by law.

  • Prepared after all necessary adjustments are made.

  • Tells about true financial position of the firm.

  • Trail balance is the source.

  • Assets, liabilities and stockholders’ equity are properly arranged.

raja
Published on 24-Jul-2020 06:42:35
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