Adjusted Trial Balance

Adjusted Trial Balance

According to Accounting Verse (n.d.), An adjusted trial balance is prepared after adjusting entries are made and posted to the ledger.This is the second trial balance prepared in the accounting cycle. Its purpose is to test the equality between debits and credits after adjusting entries are entered into the books of the company.

FORMAT OF THE ADJUSTED TRIAL BALANCE:

An adjusted trial balance is formatted exactly like an unadjusted trial balance. Three columns are used to display the account names, debits, and credits with the debit balances listed in the left column and the credit balances are listed on the right.

Like the unadjusted trial balance, the adjusted trial balance accounts are usually listed in order of their account number or in balance sheet order starting with the assets, liabilities, and equity accounts and ending with income and expense accounts.

Both the debit and credit columns are calculated at the bottom of a trial balance. As with the accounting equation, these debit and credit totals must always be equal. If they aren't equal, the trial balance was prepared incorrectly or the journal entries weren't transferred to the ledger accounts accurately.

As with all financial reports, trial balances are always prepared with a heading. Typically, the heading consists of three lines containing the company name, name of the trial balance, and date of the reporting period

PREPARING THE ADJUSTED TRIAL BALANCE:

There are two main ways to prepare an adjusted trial balance. Both ways are useful depending on the site of the company and chart of accounts being used.

You could post accounts to the adjusted trial balance using the same method used in creating the unadjusted trial balance. The account balances are taken from the T-accounts or ledger accounts and listed on the trial balance. Essentially, you are just repeating this process again except now the ledger accounts include the year-end adjusting entries.

You could also take the unadjusted trial balance and simply add the adjustments to the accounts that have been changed. In many ways this is faster for smaller companies because very few accounts will need to be altered.

Note that only active accounts that will appear on the financial statements must to be listed on the trial balance. If an account has a zero balance, there is no need to list it on the trial balance.

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SCREENSHOTS OF THE SITES I USED FOR SOURCES:

REFERENCES:

http://www.accountingverse.com/accounting-basics/adjusted-trial-balance.html

http://www.myaccountingcourse.com/accounting-cycle/adjusted-trial-balance

http://study.com/academy/lesson/adjusted-trial-balance-definition-preparation-example.html

http://accountingexplained.com/financial/cycle/adjusted-trial-balance

These are the websites that helped me to define what Adjusted Trial Balance is. Also, it helped me to identify the format, principles and procedures to follow in making the Adjusted Trial Balance.

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Learning Reflections

Preparing the adjusted trial balance was easy for me because the principles and procedures that is needed to be followed is very simple and can be understood easily. One more thing, I can say that it was easy for me because I was listening to our MOST HANDSOME TEACHER, SIR RANDY PALESTINA every time that he would discuss about it in class and because of that I realized that if I will just listen closely and carefully to my teacher, I would be able to understand the every lesson that he would teach very easily.

Summary

In short, I just realized that preparing adjusted trial balance is very easy. All I need is to listen to my teacher every time that he would discuss a lesson. Also, I BELIEVE THAT IF YOU ARE STILL AN ASPIRING BOOKKEEPER RIGHT NOW BUT YOU ARE REALLY DETERMINED TO PURSUE YOUR DREAMS, NOTHING CAN GET IN YOUR WAY NO MATTER HOW BIG THAT PROBLEM IS OR HOW HARD THE LESSONS ARE!!!!!! COURAGE AND PATIENCE IS THE KEY TO SUCCESS!!!

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THIS WOULD BE MY LAST BLOG POST FOR THIS WEBSITE.....

I AM TRULY VERY GLAD AND THANKFUL FOR BEING A PART OF THE BOOKKEEPING STRAND FOR ALMOST 2 YEARS BECAUSE I REALLY LEARNED A LOT...

ONCE AGAIN.....

THIS IS LAWRENCE ADRIAN V. ROSALES, AN ASPIRING BOOKKEEPER, SIGNING OUT...

(P.S. SIR RANDY...THANK YOU PO FOR TEACHING MY MIND, TOUCHING MY HEART AND TRANSFORMING MY LIFE...THANK YOU PO FOR ALL...I AM LOOKING FORWARD SEEING YOU ONCE AGAIN NEXT SCHOOL YEAR PO!!!!!)