Totalling & Balancing of Accounts:

 Add up to both sides to find out their

totals (Do not write anything in the
account at this stage)
 Deduct the smaller total from the larger
total to find the balance
 Enter the balance on the side with the
smaller total and describe it as
Balance carried down (c/d) with the last
day of the month in the Date column

May 30, 2024 1

 Totalling & Balancing of
Accounts
 Enter the larger Total now on
both sides
 Finally, enter the balance again
on the line below the Totals on
the opposite side of Balance c/d.
 Describe it as Balance brought
down (b/d) with the first day of
next month in the Date column.
May 30, 2024 2
 QUESTION 4: LEDGER
 Bank

Date Particulars Amount (P) Date Particulars Amount (P)

2023 2023
July 1 Capital 9 500 July 2 Office Furniture 150
July 10 Tools Ltd 750
July23 Rent 100

July 31 Balance c/d 8 500

9 500 9 500

Aug 1 Balance b/d 8 500

May 30, 2024 3
 LEDGER
 Capital
Date Particulars Amount(P) Date Particulars Amount (P)
2023 2023
July 31 Balance c/d 9 500 July1 Bank 9 500

9 500 9 500
Aug1 Balance b/d 9 500

May 30, 2024 4

 LEDGER
 Office Furniture


Date Particulars Amount(P) Date Particulars Amount (P)

2023 2023
July 2 Bank 150 July 31 Balance c/d 150

150 150

Aug 1 Balance b/d 150

May 30, 2024 5

 LEDGER
 Machinery
Date Particulars Amount (P) Date Particulars Amount (P)
2023 2023
July 3 Tools Ltd. 750 July 31 Balance c/d 750

750 750

Aug 1 Balance b/d 750

May 30, 2024 6

 LEDGER
 TOOLS LTD
Date Particulars Amount(P) Date Particulars Amount(P)
2023 2023
July10 Bank 750 July 3 Machinery 750

750 750

May 30, 2024 7

 LEDGER
 RENT
Date Particulars Amount (P) Date Particulars Amount (P)
2023 2023
July 23 Bank 100 July 31 Balance c/d 100

100 100

Aug 1 Balance b/d 100

May 30, 2024 8

 LEDGER
 Purchases
Date Particulars Amount (P) Date Particulars Amount (P)

2023 2023
July 31 Top Wholesalers 500 July 31 Balance c/d 500

500 500
Aug 1 Balance b/d 500

May 30, 2024 9

 LEDGER
 TOP WHOLESALERS
Date Particulars Amount (P) Date Particulars Amount (P)

2023 2023
July 31 Balance c/d 500 July 31 Purchases 500

500 500
Aug 1 Balance b/d 500

May 30, 2024 10

 LEDGER
 Sales
2023 2023
July 31 Balance c/d 300 July 31 Thomson 300

300 300

Aug 1 Balance b/d 300

May 30, 2024 11

 LEDGER
THOMSON
2023 2023
July 31 Sales 300 July 31 Balance c/d 300

300 300
Aug 1 Balance b/d 300

May 30, 2024 12

 TRIAL BALANCE
 Trial Balance is a list of closing
balances of ledger accounts
prepared on a certain specific date.
 It is the first step towards the
preparation of financial statements.
 It is usually prepared at the end of
an accounting period to assist in
the drafting of financial statements.
 TRIAL BALANCE
 Trial Balance is a statement prepared
separately from Ledger Accounts
 It records all Ledger Account (debit
and credit) Balances on a particular
date
 Prepared to check whether the
transactions has been recorded
correctly applying the double entry
principle &
 To test its arithmetical accuracy.
 TRIAL BALANCE
 Ledger account balances are separated
into debit balances and credit balances.
 Asset and expense account balances are
recorded debit column of the trial
balance whereas Capital, liabilities and
income are captured on the credit
column
 If all accounting entries are recorded
correctly and all the ledger balances are
accurately extracted, the total of all
debit balances must equal to the total of
all credit balances.
 TRIAL BALANCE
 Trial balance serves as the first
step in the preparation of financial
statements.
 Trial balance ensures that for
every debit entry recorded, a
corresponding credit entry has
been recorded in the Ledger in
accordance with the double entry
principle
 TRIAL BALANCE as at 31 July 2023
Debit (P) Credit (P)
Bank 8 500
Capital 9 500
Office Furniture 150
Machinery 750
Rent 100
Purchases 500
Top Wholesalers 500
Sales 300
Thomson 300

10 300 10 300

May 30, 2024 17

QUESTION 5: SELF STUDY-
STUDENTS

 REQUIRED:

 Enter business transactions in the ledger

accounts

 Total and balance off the accounts

 Draw a trial balance

May 30, 2024 18

ANSWER TO QUESTION 5
Transactions

Started Record on the Record on the

business with DEBIT side of CREDIT side
P50 000 in the Bank Account Capital Account
Bank P50 000. P50 000

Bought office Record on the Record on the

equipment for P DEBIT side of CREDIT side of
5 000 by cheque Equipment Bank Account
Account P5 000
May 30, 2024 P5 000 19
ANSWER TO QUESTION 5
Bought Motor Van Record on the Record on the
for P20 000 on DEBIT side of CREDIT side of
credit from Motor Motor Van Motor Centre
Centre Botswana Account Account
P20 000 P20 000
Bought goods on Record on Record on the
credit for P5 000 DEBIT side of CREDIT side of
from Trans Purchases Trans
Wholesalers Account Wholesalers
P5 000 (Trade Creditor)
May 30, 2024 P5 000 20
ANSWER TO QUESTION 5
Bought office Record on the Record on the
furniture for P3 DEBIT side of CREDIT side of
000 by cheque Office Bank Account
Furniture P3 000
Account
P3 000

Sold goods on Record on the Record on the

credit to Paul for DEBIT side of CREDIT side of
P1 500 Paul Account Sales Account
May 30, 2024
(Trade Debtor) P1 500 21

P1 500
ANSWER TO QUESTION 5
Paid Motor Centre Record on the Record on
Botswana P 5 000 by DEBIT side of the CREDIT
cheque Motor Centre side of Bank
Account Account
P5 000 P 5000

Paid rent by cheque Record on the Record on

P1 000 by cheque DEBIT side of the CREDIT
Rent Account side of Bank
P1 000 Account
May 30, 2024 P1 000 22
ANSWER TO QUESTION 5
Paid salary to the Record on the Record on the
employee P2 000 DEBIT side of CREDIT side of
by cheque Salary Bank Account
Account P2 000
P2 000
Paid Motor Record on the Record on the
Centre Botswana DEBIT side of CREDIT side of
the balance Motor Centre Bank Account
amount due on Account P15 000
the Motor Van P15 000
purchased
May 30, 2024 on 23

January 5.