Trial Balance Vs Balance Sheet Vs Income Statement

Once expenses are subtracted from revenues operating revenue remains.

Trial balance vs balance sheet vs income statement. Trial balance can be prepared as per requirement of the organization while the balance sheet is prepared at a particular date which is usually at the end of the accounting year. For example those costs may include interest expense and tax payments. The balance sheet is one of the three financial statements that a company needs to file mandatorily under accounting principles. Balance sheet and trial balance are two important reports of the accounting system.

The balance sheet is also referred to as the statement of financial position. The balance sheet shows a company s total value while the income statement shows whether a company is generating a profit or a loss. The trial balance is not read by the users of the financial statement or stakeholders but balance sheet is used by them. Trial balance on the other hand is usually for the internal purposes of the company though both serve different purposes they are very important for a business.

Balance sheet vs income statement.