Following is the procedure for balancing an account:
1. The debit and credit columns of an account are to be totaled separately.
2. The difference between the two totals is to be ascertained.
3. The difference is to be placed in the amount column of the side having lesser total. ‘Balance c/d’ is to be entered in the particulars column against the difference and in the date column the last day of the accounting period is entered.
4. Now both the debit and credit columns are to be totaled and the totals will be equal. The totals of both sides are to be recorded in the same line horizontally. The total is to be distinguished from other figures by drawing lines above and below the amount.
5. The difference has to be brought down to the opposite side below the total. ‘Balance b/d’ is to be entered in the particulars column against the difference brought down and in the date column, the first day of the next accounting period is entered.
6. If the total on the debit side of an account is higher, the balancing figure is debit balance and if the credit side of an account has higher total, the balancing figure is credit balance. If the two sides are equal, that account will show nil balance.
