Trial Balance

A trial balance is a list of all ledger accounts and their debit or credit balances at a point in time.

It is used to check arithmetical accuracy and as a starting point for preparing financial statements, though it does not guarantee absence of errors.

- Used in day-to-day bookkeeping and journal entries to record transactions correctly.
- Used when preparing trial balances and reconciling accounts.

- Example: Accountants use **Trial Balance** when recording transactions and preparing the trial balance.

- Why it matters: Ensures accurate records, supports reliable reporting, and reduces posting and reconciliation errors.