Page 157 - Account 10

Solution:
Balance Sheet of ABC Co., Kathmandu
As on 30 Chaitra, 2075
th
Capital and Liabilities Amount Assets Amount
Capital 8,500 Goodwill 3,100
Add: Net profit 4,285 12,785 Machinery 2,000
Reserve 1,300 Furniture 955
Loan from bank 1,000 Building 2,400
Creditors 5,015 Vehicles 1,035
Bills payables 900 Debtors 7,800
Closing stock 1,700
Bills receivables 1,245
Cash at bank 755
Cash in hand 10
Total: 21,000 Total: 21,000

15. Similarities between Trial Balance and Balance Sheet
Trial Balance and Balance Sheet have some similarities, even though these two
headings are different. These are mentioned below:
i. Both the trial balance and balance sheet are statements and not accounts.
ii. Both of them are prepared on the basis of the balances of ledger headings. They
record only the accounts, which have got a balance to each.
iii. Both of them help in checking the arithmetic accuracy by showing the agreement
in totals. Again, when there’s a difference in trial balance, the same difference takes
place in the balance sheet. But remember that the totals of trial balance and balance
sheet do not equal.
iv. There’s no use of the words ‘To’ and ‘By’ in both the statements.
v. Both statements are prepared on a particular date.

16. Differences between Trial Balance and Balance Sheet
Trial balance and balance sheet are exactly different headings in spite of their minor
similarities. The main differences between them are mentioned below:
Trial Balance Balance Sheet
i. Meaning A trial balance is a statement of A balance sheet is a statement of only the
all the ledger balances of a certain assets capital and liabilities on a certain
point of time to see the arithmetical date to see the financial position of a firm.
accuracy of the books of account of
a firm.
ii. Time interval A trial balance may be prepared A balance sheet is prepared at the close of
periodically, specially at the end of each accounting year.
each month.

156 Aakar’s Office Practice and Accountancy - 10 Final Accounts 157