The balance is the difference between income and expense for a selected time interval. In accounting, this is the difference between a debit and a credit on a selected account and for a certain period of time.
Instructions
Step 1
To calculate this value, for example, by cash receipts, you need to add up all the funds received for a certain time interval and the expenditure of these funds for the same period. And calculate the difference between these two numbers. It will be the balance.
Step 2
The balance at the beginning of the period is the cash balance at the beginning of the selected period.
Step 3
To see the balance in accounting, you need to generate a balance sheet for a specific account and for a specific period of time. You can also generate a "Profit and Loss Statement" (form number 2) and see the initial and of course the balance.
Step 4
There are formulas that are used to calculate the balance of active and passive accounts:
Final Debit Balance = Initial Balance + Debit Turnover - Credit Turnover Final Credit Balance = Initial Balance + Credit Turnover - Debit Turnover
This difference is very convenient when drawing up acts of reconciliation with the organization's counterparties.
