Read this article to learn about the difference between trial balance and balance sheet.
Trial Balance:
1. Trial balance is a schedule showing equality of all debits and credits.
2. The purpose of preparation of trial balance is to verify whether all debits balances are equal to the all credit balances.
3. Balances of all debits and credits are to be extracted from all accounts, including cash book and shown in this schedule
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4. Usually, trial balance is prepared every month or at any time to verify the accuracy of books of accounts.
5. Trial balance is prepared without taking into consideration any adjustments.
6. All items are shown under two headings debit and credit.
Balance Sheet:
1. Balance sheet is a statement showing the position of assets and liabilities of the business.
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2. The purpose of preparation of balance sheet is to show true and fair view of the business enterprise on any particular day and at a specific point of time.
3. Balances of only real and personal accounts are to be shown in the balance sheet.
4. Usually, balance sheet is prepared at the end of accounting year.
5. Balance sheet is prepared with the help of certain adjustments related to the business enterprise.
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6. All items are shown under two headings viz., assets and liabilities.