Page 2 - LN

Limitations of Trial Balance :

One main limitation is that it does not point out all types of errors. This

means that even if we have a fully balanced Trial Balance will not

assure 100% accuracy of the accounts. There are many types

of errors a trial balance does not draw attention too. Some such

errors are

• A transaction that is completely missing, was not even journalized

• When the wrong amount was written in both the accounts

• If a posting was done in the wrong account but in the right

amount

• An entry that was never posted in the ledger altogether

• Double posting of entry by mistake

FORMAT OF TRAIL BALANCE:

S.No. Heads of Accounts LF. Debit Credit

1 Purchases A/C xxxx

2 Salaries A/C xxxx

3 Land & Building A/C xxxx

4 Cash A/C xxxx

5 Capital A/C xxxx