trial balance - troubleshooting

[David Cousens]

Hi,



On 05/24/2016 12:30 PM, __ wrote:
> thanks for the feedback. If you mean that for a personal account there
> is no legal requirement for debits to match credits ... that migh be
> true. Especialy while there is not requirement to do accounting for a
> person in general ....
> 
> I am referring to what wikpedia says about tse purpose a trial balance
>    "... to prove that the value of all the debit value balances equal
> the total of all the credit value balances. If the total of the debit
> column does not equal the total value of the credit column then this
> would show that there is an error in the nominal ledger accounts. This
> error must be found before a profit and loss statement and balance sheet
> can be produced"
> 
There is no requirement legal or logical for the debits and credits to
an individual account to sum to zero as I previously explained.

If you look carefully at the Wikipedia article on the Trial Balance
(first sentence), the requirement is that the total of the debits over
all accounts in the trial balance must equal the total of the credits
over all accounts, not that the debits and credits to an individual
account to be equal. The trial balance only transfers the balance (and
whether a debit or credit balance), not all of the individual
transactions to an account.

This occurs in double entry bookkeeping because the system is set up so
that the total of the debits (to one or more accounts) must equal the
total of the credits (to one or more accounts- not necessarily the same
accounts as for the debits) in any individual transaction and
consequently when summed over all transactions to all accounts, i.e. the
trial balance, the total of the debits must equal the total of the credits.

> I think also just logically they have to match unless there is a logical
> error

Not so
> 
Hope this clarifies it for you

David

-- 
*Dr David R Cousens* B.Sc.(Physics), M. Prof. Acc., Ph.D. (Physics),
Grad.Cert. Ed.

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