Balancing of accounts MCQs Quiz | Class 9
This quiz is for Class IX students studying Elements of Book-Keeping & Accountancy (Code 254), focusing on Unit 5: Ledger. It covers essential topics like how to find the closing balance, understanding the difference of sides, and the use of carry down (c/d) and brought down (b/d) conventions. Answer all 10 questions and click submit to see your score and download a PDF of your answers.
Understanding the Balancing of Accounts
In accountancy, “balancing of accounts” is a fundamental process performed at the end of an accounting period. It involves equalizing the two sides (debit and credit) of a ledger account to determine its net balance. This balance is then carried forward to the next accounting period, forming the basis of the Trial Balance.
Key Concepts in Balancing
1. Finding the Closing Balance
The core of balancing is to find the difference between the total of the debit side and the total of the credit side of an account. The steps are as follows:
- Total Both Sides: Add up all the amounts on the debit side and the credit side separately.
- Find the Difference: Subtract the smaller total from the larger total. This difference is the “balance” of the account.
- Insert the Balance: Write the balance amount on the side with the smaller total, so that the totals of both sides now match.
- Carry Down the Balance: Against this balance amount, write “By Balance c/d” (if on the debit side) or “To Balance c/d” (if on the credit side). ‘c/d’ stands for “carried down”.
2. Understanding Debit and Credit Balances
The side with the larger total determines the nature of the balance.
- Debit Balance: If the total of the debit side is greater than the total of the credit side, the account is said to have a debit balance. This is typical for Asset and Expense accounts.
- Credit Balance: If the total of the credit side is greater than the total of the debit side, the account is said to have a credit balance. This is typical for Liability, Capital, and Revenue accounts.
3. The Role of ‘Carried Down’ (c/d) and ‘Brought Down’ (b/d)
These terms are crucial for continuity between accounting periods.
- Balance c/d (Carried Down): This represents the closing balance for the current period. It is written on the side with the smaller total to make the two sides equal before closing the account.
- Balance b/d (Brought Down): This represents the opening balance for the next period. It is written on the opposite side of the ‘Balance c/d’ on the first day of the new period. For example, if a debit balance was closed with “By Balance c/d” on the credit side, it will be opened with “To Balance b/d” on the debit side in the next period.
Example: Balancing a Simple Cash Account
Let’s say a Cash Account has the following entries:
| Dr. Cash Account Cr. | |||||
|---|---|---|---|---|---|
| Date | Particulars | Amount (Rs.) | Date | Particulars | Amount (Rs.) |
| Jan 1 | To Capital A/c | 50,000 | Jan 5 | By Purchases A/c | 20,000 |
| Jan 10 | To Sales A/c | 10,000 | Jan 15 | By Rent A/c | 5,000 |
| Jan 31 | By Balance c/d | 35,000 | |||
| Total | 60,000 | Total | 60,000 | ||
| Feb 1 | To Balance b/d | 35,000 | |||
Here, the debit total (60,000) was greater than the credit total (25,000). The difference (35,000) was added to the credit side as “By Balance c/d” to balance the totals. This closing balance is then brought down to the debit side as the opening balance for the next month.
Quick Revision Points
- Balancing is done to find the net position of an account.
- The difference between the debit and credit totals is the balance.
- “Balance c/d” is the closing balance for the current period.
- “Balance b/d” is the opening balance for the next period.
- Personal and Real accounts are balanced and carried forward.
- Nominal accounts (expenses, incomes) are not balanced; their totals are transferred to the Trading and Profit & Loss Account.
Practice Questions
- If the credit side of an account is Rs. 15,000 and the debit side is Rs. 10,000, what is the balance and what type is it?
- What is the purpose of writing “To Balance b/d”?
- Which types of accounts are generally not balanced but closed by transfer?
- If an account has a debit balance of Rs. 5,000, where will the “Balance c/d” be written?
- The process of transferring the balance of an account to the next period is called what?
