Multiple choice

What do you mean by “balancing of accounts”?

  1. Total of credit side

  2. Total of debit side

  3. Total of both,debit & credit side

  4. Difference in total of debit & credit side

Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Balancing an account involves calculating the difference between the total debits and the total credits. This difference, known as the balance, is then entered on the side with the smaller total to make both sides equal. This process is essential for preparing the trial balance and financial statements.