Difference between Trial Balance and Balance Sheet
Objective
Trial Balance is prepared to verify the arithmetical accuracy of the books of account whereas Balance Sheet shows the financial position of the business.
Headings
Trial Balance is two sides i.e. Debit and Credit whereas Balance Sheet has Assets and Liabilities.Profit and LossTrial Balance does not show any information about the profit or loss of a business, whereas Balance Sheet records the Profit or Loss of the business.
Closing stock
The valuation of closing stock is not necessary to prepare a Trial Balance whereas Balance Sheet cannot be prepared unless the Closing stock for that particular accounting year is not ascertained.
Types of Accounts
Balances of all types of accounts are recorded in a Trial Balance i.e. Personal, real and nominal. Balance Sheet records balances of personal and real accounts only.
Adjustments
Adjustment for outstanding expenses, prepaid expenses and accrued incomes are not required for the preparation of Trial Balance. A Balance sheet is only complete after all the necessary adjustments are made.
