Trial balance to balance sheet

An invented furniture workshop's trial balance at its year end, 31 March 2026:

The same balances, set out as a balance sheet:

The profit of £32,100 is the sales of £401,000 less every expense in the trial balance; trial balance to profit and loss sets that half out line by line.

1. Split the accounts. Assets, liabilities and equity go to the balance sheet; sales and expenses go to the profit and loss. Check the trial balance first: total debits must equal total credits.
2. Group each balance sheet account into a line. Customer accounts into trade debtors, bank accounts into bank, accumulated depreciation against the cost it belongs to, and VAT, payroll taxes and loans into lines of their own.
3. Carry the profit into reserves, then check. Add the year's profit, sales less expenses, to retained earnings. Net assets must equal capital and reserves to the penny; a difference means an account was missed or put on the wrong side.

Until the year is closed, the profit sits in the trial balance as sales and expenses, not in retained earnings. Leave those accounts out and the balance sheet is short by exactly the profit: £32,100 for the workshop. A monthly balance sheet works the same way, with the year's profit to date in place of the year's.

Place each account by the side its balance is on, not by its name:

• an overdrawn bank account is a liability, not negative cash;
• a customer who paid in advance leaves a credit on debtors, which is money owed back;
• VAT reclaimable is an asset, VAT payable a liability, even when both live in one account.

Upload the trial balance as it comes out of your accounting software, in Excel, CSV or a text PDF. Each account is placed on a line once and remembered, so the next month is a refresh. The workbook holds the balance sheet in the layout of the company's framework (the UK Companies Act formats, US GAAP, IFRS or Schedule III), with the profit for the year carried into reserves, any account not yet placed on a line of its own, and nothing forced to balance. It is checked before it is delivered: the trial balance ties and the two sides agree. These are monthly management statements, not the accounts a company files. Prepaid credits, no subscription, and every action shows its price before it runs: see the credit packs.