Methods of preparing Trial Balance There are mainly two methods of preparing Trial Balance. In any method, the total of debit and credit columns of the Trial Balance must be qual. The two method are: 1. Balance method, 2. Total method Q18 1. Balance method: This is the most commonly used method of preparing trial balance. As its name indicates, the Trial balance is prepared with the balances of ledger accounts. The debit balance amounts are shown in the debit amount column and credit balance amounts are shown in the credit balance column. The total of both the debit and credit balance columns must be equal. Any difference is due to any error or errors to be located and rectified. 2. Total Method: Under this method, the total of the debit side and credit side of every account is separately written in the debit and credit columns of the Trial balance. The total of both debit and credit columns has to be equal. If it is not equal, there must be certain errors which should be located and rectified. The preparation of both the types of Trial Balance are illustrated below. Illustration 1 From the following transactions, pass journal entries, prepare ledger accounts and also prepare Trial Balance under both methods. 1. Anil started business with 8,000 2. Purchased furniture 1,000 3. Purchased goods 6,000 4. Sold goods 7,000 5. Purchased from Raja 4,000 6. Sold to Somu 5,000 7. Paid to Raja 2,500 8. Received from Somu 3,000 9. Paid rent 200 10. Received commission 100