TRIAL BALANCE vs BALANCE SHEET

Front

What is the trial balance?

Back

A report showing the closing balances of all general ledger accounts at a single point in time.

Front

What is the balance sheet?

Back

A snapshot of a business's assets, liabilities, and equity at a single point in time.

Front

What is the purpose of the trial balance?

Back

To check the integrity of financial data

Front

What is the purpose of the balance sheet?

Back

To report a business's assets, liabilities, and equity

Front

What does the trial balance show?

Back

Closing balances of all general ledger accounts

Front

What does the balance sheet show?

Back

Assets, liabilities, and equity

Front

What is the purpose of financial statements?

Back

To summarize a business's financial performance, position, and cash flow

Front

Who are the stakeholders of a business?

Back

Existing and potential investors, lenders, and creditors

Front

When do accountants typically prepare a balance sheet?

Back

At the end of each financial year

Front

What is the link between the trial balance and the balance sheet?

Back

The trial balance is used to create the balance sheet.