Accounts: Their Construction and Interpretation for Business Men and Students of Affairs

By William Morse Cole | Go to book overview
TRIAL BALANCE, STATEMENT, AND BALANCE SHEET
9 Cash 2470 06
13 Bills Recievable 500 00
43 J. Straw 495 00
20 Interest 4 33
39 O. Twist 240 00
11 Mdse. 2240 00
37 N. Nickleby 570 73
21 Expense 100 00
3310 06 3310 06

The principle of the trial balance is obvious enough. Clearly the total of all credits posted to the ledger must equal the total of all debits posted to the ledger. A balance is simply the excess of one side over the other, --that is to say, the two sides are equal except for the balance. When, then, in taking a trial balance the bookkeeper omits all accounts which have no balance, and takes from other accounts only the excess of one side over the other, he is simply omitting from his test of the ledger those debits and credits which have already shown themselves to be equal and therefore beyond the need of test. If the parts tested show themselves equal, and the parts not tested are already known to be equal, obviously the totals must be equal.

In the ledger before us, since the accounts of Bills Payable and Felix Holt show no balances, those accounts do not appear. No ledger could in practice look quite like this one, for, as has been already suggested, previous transactions must have taken place,-- else J. Straw and N. Nickleby could not owe the business, and merchandise could not be sold before any had been bought; but we may be sure that the previous transactions must also have had a correspondence of debit and credit, and these equal balances added to old equal balances must produce totals that are equal. So the trial balance is correct for our purpose.

It is easy either to overstate or to understate the value of a trial balance. The trial balance proves nothing; and yet by the law of chance it is very good evidence that except in two particulars the books are correct. If an error has been made in posting a debit to John Jones's account when the posting should have been made to John Smith's account, the trial balance will not indicate that anything is wrong, for the trial balance shows simply whether a sufficient amount has been debited somewhere; if, on the other hand,

-35-

Notes for this page

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items
Notes
Cite this page

Cited page

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Note: primary sources have slightly different requirements for citation. Please see these guidelines for more information.

Cited page

Bookmark this page
Accounts: Their Construction and Interpretation for Business Men and Students of Affairs
Table of contents

Table of contents

Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this book

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen
Items saved from this book
  • Bookmarks
  • Highlights & Notes
  • Citations
/ 346

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Search by... Author
    Show... All Results Primary Sources Peer-reviewed

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.