6 - 1 Wood/Robinson: Book-keeping and Accounts, 6e, © T. Sijtsma 2007

Book-keepingBook-keepingBalancing off accountsBalancing off accounts

Chapter 6Chapter 6

6 - 2 Wood/Robinson: Book-keeping and Accounts, 6e, © T. Sijtsma

Learning Objective 1, 2 Learning Objective 1, 2 and 3and 3

Distinguish between a debit and a credit balance

Balance off accounts at the end of a period and bring down the opening

Understand what is meant by ‘balancing off’ accounts

6 - 3 Wood/Robinson: Book-keeping and Accounts, 6e, © T. Sijtsma

Learning balancing off accounts:Learning balancing off accounts:a debtor accounta debtor account

Stage 1: Add up both sides to find out their totals. Do not write anything in the account at this stage

Debit total: 482 Credit total: 158

Debit D. Knight account Credit 2005 ₤ 2005 ₤ Aug 1 Sales 158 Aug 28 Bank 158 Aug 15 Sales 206 Aug 30 Sales 118

6 - 4 Wood/Robinson: Book-keeping and Accounts, 6e, © T. Sijtsma

Learning balancing off accounts: Learning balancing off accounts: a debtor accounta debtor account

Stage 2: Deduct the smaller total from the larger total to find the balance

Debit total: 482 Credit total: 158

482 - 158 = 324

Debit D. Knight account Credit2005 £ 2005 £Aug 1 Sales 158 Aug 28 Bank 158Aug 15 Sales 206Aug 30 Sales 118

6 - 5 Wood/Robinson: Book-keeping and Accounts, 6e, © T. Sijtsma

Learning balancing off accounts: Learning balancing off accounts: a debtor account with a credit balancea debtor account with a credit balance

Stage 3: enter balance here so that totals will be equal

Stage 4: enter totals level with each other

Stage 5: enter balance to start off entries for following month

Debit D. Knight account Credit2005 £ 2005 £Aug 1 Sales 158 Aug 28 Bank 158Aug 15 Sales 206 Aug 31 Balance c/d 324Aug 30 Sales 118

482 482

Sept 1 Balance b/d 324

c/d = carried downb/d = brought down

6 - 6 Wood/Robinson: Book-keeping and Accounts, 6e, © T. Sijtsma

Debit E. Williams account Credit2005 £ 2005 £Aug 21 Bank 100 Aug 2 Purchases 248

Aug 18 Purchases 116

Learning balancing off accounts: Learning balancing off accounts: a creditor accounta creditor account

Stage 1: Add up both sides to find out their totals. Do not write anything in the account at this stage

Debit total: 100 Credit total: 364

6 - 7 Wood/Robinson: Book-keeping and Accounts, 6e, © T. Sijtsma

Debit E. Williams account Credit2005 £ 2005 £Aug 21 Bank 100 Aug 2 Purchases 248

Aug 18 Purchases 116

Learning balancing off accounts: Learning balancing off accounts: a creditor account a creditor account

Stage 2: Deduct the smaller total from the larger total to find the balance

Debit total: 100 Credit total: 364

364 - 100 = 264

6 - 8 Wood/Robinson: Book-keeping and Accounts, 6e, © T. Sijtsma

Debit E. Williams account Credit2005 £ 2005 £Aug 21 Bank 100 Aug 2 Purchases 248Aug 31 Balance c/d 264 Aug 18 Purchases 116

364 364

Sept 1 Balance b/d 264

Learning balancing off accounts: Learning balancing off accounts: a creditor account with a debit balancea creditor account with a debit balance

Stage 3: enter balance here so that totals will be equal

Stage 4: enter totals level with each other

Stage 5: enter balance to start off entries for following month

c/d = carried down b/d = brought down

6 - 9 Wood/Robinson: Book-keeping and Accounts, 6e, © T. Sijtsma

Learning Objective 4Learning Objective 4

Prepare accounts in a three column format, as used in computerised accounts.

6 - 10 Wood/Robinson: Book-keeping and Accounts, 6e, © T. Sijtsma

Learning: Balancing off accounts Learning: Balancing off accounts on computeron computer

Three column lay-out debtor account:

Column 1: for debit entry

Column 2: for credit entry

Column 3: for balance

D. Knight account Debit Credit Balance 20x6 ₤ ₤ ₤ Aug 1 Sales 158 158 Dr Aug 15 Sales 206 364 Dr Aug 28 Cash 158 206 Dr Aug 30 Sales 118 324 Dr

6 - 11 Wood/Robinson: Book-keeping and Accounts, 6e, © T. Sijtsma

Learning: Balancing off accounts Learning: Balancing off accounts on computeron computer

Three column lay-out creditor account:

Column 1: for debit entry

Column 2: for credit entry

Column 3: for balance

E. Williams account Debit Credit Balance 20x6 ₤ ₤ ₤ Aug 2 Purchases 248 248 Cr Aug 18 Purchases 116 364 Cr Aug 21 Bank 100 264 Cr

6 - 12 Wood/Robinson: Book-keeping and Accounts, 6e, © T. Sijtsma 2007

End of Chapter 6:End of Chapter 6:Balancing off accountsBalancing off accounts