How to Prepare a Trial Balance

[@elycatrachita17]

You are an amazing teacher thank you for this class, it has been super helpful! Greetings from London

[@stevenforce3344]

Glad it was helpful!

[@rizanafaleel8811]

Sir your teaching is excellent

[@kissy7933]

Thank you so much! You just saved my life lol! And my grade...

[@SodiqovaMuslimaSodiqovaMuslima]

Thank you so much

[@NabukenyaSheebah-q4t]

How do you which is asset and staff

[@MargaretwambuiMuita]

Why do we arrange in liquidity

[@stevenforce3344]

Listing in the order of liquidity allows users of the reports and statements to assess the financial health of the company. For example, they can see how quickly and easily a company would be able to pay back their debts, based on how liquid the company's assets are.

[@sathyasanil3040]

is there any possible way of the debit and credit not being equal?

[@stevenforce3344]

When you are preparing a trial balance, the debits and credits always need to equal. Here's a video that talks about what to do if the debits and credits don't equal on the trial balance: kzbin.info/www/bejne/jZLTXpl9nK6Slbs

[@bluebioluminescence]

@@stevenforce3344 what if a company recieved more than they paid for or something similar? or if they just received a large donation and the cash account just got more money? how will it be equal then?

[@lovidezoenterprisesltd4176]

What happens if you don't put the details in order

[@notu1529]

it will be less ordered.

[@dinasvlog4927]

hello can i ask why is the unearned service revenue is liability?

[@stevenforce3344]

Any type of unearned revenue is a liability because the company owes something to the customer. Unearned Service Revenue is when the customer pays up front, and then services will be performed sometime in the future. Once the company collects the money, they now owe (they're liable for) the work to be done in the future. An example of this would be airlines. A customer would pay in advance for a flight, and then the airline then owes the customer their flight at sometime in the future.

[@NamrubeNamahlangu]

Sir i would like to know why my trial does not balance

[@stevenforce3344]

Here's a video to help you find the errors in your trial balance: kzbin.info/www/bejne/jZLTXpl9nK6Slbs

[@ninjapirate123]

Sir can you tell me what inventory and Freight out go into?

[@stevenforce3344]

Inventory is an asset account, and Freight Out is an expense account. In this example, Inventory would be placed between Accounts Receivable and Supplies because assets need to be listed in the order of liquidity. Freight Out would be placed with the other expense accounts at the bottom of the Trial Balance.

[@ninjapirate123]

@@stevenforce3344 Thanks

[@melissachan2429]

May I ask why supplies is an asset account 1:02

[@stevenforce3344]

Assets are resources that a company has that helps them perform their operations. Supplies are things like office supplies (paper, pencils, pens, etc.) so those help the day-to-day operations of a business run smoothly. Hope this helps!

[@dee-g6f]

may i ask why is owners drawings in debit?

[@stevenforce3344]

Owner's Drawings has a normal debit balance, so it's balance will be in the debit side. The reason is that it decreases the overall Owner's Equity of a company. Owner's Capital and Revenues increase equity (and have credit balances). So, Owner's Drawings and Expenses, which decrease equity, need to have the opposite balance, which is why they end up with debit balances.

[@dayanazz]

@@stevenforce3344thankyou sir

[@oliibnath607]

My teacher teach us the trail balance but your Oder of trail balance is not same as my teacher is it normal .

[@stevenforce3344]

The trial balance will follow the order of the expanded accounting equation. Then, the assets must be in the order of liquidity. Hope this helps!

[@oliibnath607]

@@stevenforce3344 what is the order of liquidity?

[@stevenforce3344]

The order of liquidity refers to how quickly we can turn an asset into cash, or how quickly we can use up an asset. Cash will always be first in this list. After Cash, it will depend on the other accounts that you have.

[@oliibnath607]

@@stevenforce3344 Thank you sir .

[@RamadankingsonSesay]

What if the credit didn't balance

[@stevenforce3344]

If the debits and credits don't balance, here are some tricks to figure out where your errors might be: kzbin.info/www/bejne/jZLTXpl9nK6Slbs

[@ajanthanilushi6073]

If if doesn’t then you should rectify the errors since the debit and the credit should be having equal balances to prepare a Trial balance.

[@RaihanMuhammad-u1q]

😊😊😊

[@sapnasonker6784]

😢