Page 85 - Microsoft Word - 00 BA3 IW Prelims STUDENT.docx

From trial balance to financial statements

Balancing the accounts

1.1 Steps to balance the ledger accounts

When the transactions for an accounting period have been recorded, it will be
necessary to find the balance on each ledger account as follows:

1 Total both sides of the T account and identify the larger total.

2 Put the larger total in the total boxes on the debit side and the credit side.

3 Insert a balancing figure to the side of the T account which does not currently
add up to the amount in the total box. Call this balancing figure ‘balance c/f’
(carried forward) or ‘balance c/d’ (carried down).

4 Carry the balance down diagonally and call it ‘balance b/f’ (brought forward) or
‘balance b/d’ (brought down)

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