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Distinguish, differentiate, compare and explain what is the difference between the Trial Balance and Balance Sheet. Comparison and Differences.
Differences between Trial Balance and Balance Sheet
| S.No. | Basis of difference | Trial Balance | Balance Sheet |
| 1 | Meaning | Trial Balance showing the equality of both column i.e. Debit and Credit. | Balance Sheet showing the financial position of an entity. |
| 2 | Purpose | It is prepared to authenticate the arithmetical accuracy of recording and posting of all business transaction. | It is prepared to show the true or fair financial position of an entity. |
| 3 | Accounts Included | It includes all type of accounts. i.e. Real, Personal and Nominal accounts. | It includes only two type of accounts. i.e. Real and Personal accounts. |
| 4 | Dependency | The trial balance is dependent on the ledger account and subsidiary books not on the balance sheet. | The balance sheet is prepared from the trial balance but it also can be prepared from ledger accounts. |
| 5 | Net Profit/ Loss | Trail balance does not contain any information about Net profit/loss. | Balance Sheet does provide information about net Profit/loss for the year under the head of capital. |
| 6 | Time of Preparation | It is prepared before preparation of Financial Statements. | It is prepared after preparing trading and Profit&Loss account. |
| 7 | Uses | It has internal use only. | It has internal as well as external use. |
| 8 | Financial Statements | The trial balance is not a part of the financial statement but it is the base of financial statements. | The balance sheet is the part of financial statements. |
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Difference between Balance Sheet vs Trial Balance
Trial Balance vs Balance Sheet
Differences between Balance Sheet vs Trial Balance
