Please help me with task (Balance Sheet from trial balance)

olaf78
olaf78 Registered Posts: 3
Trial Balance
[After closing Nominal accounts]
Particulars Debit Amount Credit Amount

Cash a/c  10,000   Debit 
Capital a/c  100,000 Credit
Bank a/c  77,000  Debit
Furniture a/c  25,000  Debit
Ram a/c  15,000 Credit
Rahim a/c  50,000  Debit
Trading and Profit & Loss a/c 47,000 Credit
Total 162,000 162,000

The Balance sheet is obtained by arranging the figures in the trial balance (ledger accounts left after having ascertained the profits) in an order.

Draw up the Balance Sheet from the above Trial Balance.


I did something like this:
Balance sheet

Assets
Current assets
Cash 10,000
Bank 77,000
Furniture 25,000
Rahim 50,000

Total current assets 162,000

Liabilities
Current liabilities
Capital 100,000
Ram 15,000
Trading and Profit & Loss a/c 47,000


Total current liabilities 162,000



But it's totally wrong.. I have no idea how to do that.. If somebody have time and can explain my like for dummy guy :) what to do?

Advice from my colleague:
What we do is to close expenses, entry is "trading profit and loss account Debit" and all expenses credit. For revenue entry is, Revenue debit, "trading profit and loss account credit"

Comments

  • Neillaw
    Neillaw Registered Posts: 307 Dedicated contributor 🦉
    You firstly need to break down you balance sheet:-
    Fixed Assets
    Current Assets
    Current Liabilities

    Financed by section:-
    Capital Account
    Profit & Loss Acc

    It's not sure from your details who owns the business or whether its a partnership so the loans from Rahim & Ram may be capital account (Financed by section) or they may be current Assets and Current Liabilities.

    As it stands at the moment your balance sheet is only working out working capital as Cassets - Clibilities.

    You would need to do some work on balance sheet formats which will make it easier for you to deal with the trial balance.
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