What is The Purpose of A Trial Balance

The Main Purpose of Trial Balance is to show Arithmetic Accuracy of Closing Balances of Different Types / Kinds of Accounts for the period. It shows the equality of Debit Balances and Credit Balances that must be agreed otherwise there is need of Rectification to solve errors, mistakes and frauds.

In Computerized Accounting System, if you use Quickbooks, then it automatically balances your accounts and you don’t need to adjust your balances on daily basis. It also prepares trial balance report for the period that helps organization to see the total balances of debit an credit sides.

It is important to note that eventhough the Trial Balance agrees but still there are some hidden errors and mistakes which it fails to disclose. These errors are solved with the help of adjusted trial balance as trial balance is also a Ledger which is adjusted with the help of books of accounts i.e., Journal and Ledgers of the business.