Preparing a Trial Balance

A trial balance is a two-column schedule that lists the names and balances of all accounts. Debit balances are listed on the left, and credit balances are on the right. The total of both columns must agree, proving the equality of debits and credits for all transactions recorded .

Uses of a Trial Balance

It ensures that debits and credits are recorded equally, and helps verify the accuracy of the ledger's addition .

Limitations

While a trial balance confirms the equality of debits and credits, it doesn't ensure all transactions were correctly recorded or prevent errors like incorrect account entries or omitted transactions.