[Gnukhata-users] balance of an account

[arun kelkar]

To all

An account may have a balance or it may not have. Depending upon the type of 
account, the balance could be Debit balance or Credit balance.
The balance represents the difference between the totals of two sides of an 
account, that is, debit side and credit side.
If the total of debit side is more than the credit side, then the balance is 
called debit balance, and it will be shown on the credit side. Similarly, the 
credit balance is shown on the debit side of the account.

The accounts falling in the following groups will normally have Debit Balance: 
Fixed Assets, Investments, Current Assets and Nominal (Expense) accounts. 
While the accounts falling in the following groups will normally have Credit 
balance: Capital, Secured Loans, Current Liabilities and Provisions and Nominal 
(Income) accounts.

If the balance in an account is not what it should normally have been, that is, if 
it is a negative balance then while generating a Report of the Ledger account, the 
report should show negative balance. 

arun kelkar

 


arun kelkar
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