Balance Sheet Calculation Guide
Understanding Balance Sheet Formula
Basic Accounting Equation
Assets = Liabilities + Capital (Owner's Equity)
For Each Ledger Account
Closing Balance Calculation
Closing Balance = Opening Balance + Total Debit - Total Credit (for Asset accounts)
Closing Balance = Opening Balance + Total Credit - Total Debit (for Liability accounts)
Detailed Calculations
LIABILITIES SIDE
1. CAPITAL ACCOUNTS
Owner's Capital (CPTL00001)
Opening Balance: 500,000.00
Add: Total Credit: 0.00
Less: Total Debit: 0.00
─────────────────────────────────
Closing Balance: 500,000.00
2. RESERVES AND SURPLUS
General Reserve (RESV00001)
Opening Balance: 100,000.00
Add: Total Credit: 50,000.00
Less: Total Debit: 0.00
─────────────────────────────────
Closing Balance: 150,000.00
3. SECURED LOANS
Bank Loan - HDFC (LOAN00001)
Opening Balance: 250,000.00
Add: Total Credit: 0.00
Less: Total Debit: 50,000.00 (Loan repayment)
─────────────────────────────────
Closing Balance: 200,000.00
4. CURRENT LIABILITIES
TDS Liabilities (WTDS00001)
Opening Balance: 15,000.00
Add: Total Credit: 5,000.00
Less: Total Debit: 0.00
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Closing Balance: 20,000.00
TCS Ledger (WTCS00001)
Opening Balance: 10,000.00
Add: Total Credit: 3,000.00
Less: Total Debit: 0.00
─────────────────────────────────
Closing Balance: 13,000.00
CGST Ledger (CGST00001)
Opening Balance: 12,000.00
Add: Total Credit: 4,000.00
Less: Total Debit: 0.00
─────────────────────────────────
Closing Balance: 16,000.00
SGST Ledger (SGST00001)
Opening Balance: 12,000.00
Add: Total Credit: 4,000.00
Less: Total Debit: 0.00
─────────────────────────────────
Closing Balance: 16,000.00
IGST Ledger (IGST00001)
Opening Balance: 15,000.00
Add: Total Credit: 5,000.00
Less: Total Debit: 0.00
─────────────────────────────────
Closing Balance: 20,000.00
Current Liabilities Group Total:
TDS: 20,000.00
TCS: 13,000.00
CGST: 16,000.00
SGST: 16,000.00
IGST: 20,000.00
─────────────────
Total: 85,000.00
5. SUNDRY CREDITORS
VISHWA Pvt Ltd (VEND00001)
Opening Balance: 200,000.00
Add: Total Credit: 50,000.00 (Purchases)
Less: Total Debit: 0.00
─────────────────────────────────
Closing Balance: 250,000.00
TOTAL LIABILITIES CALCULATION
Capital Accounts: 500,000.00
Reserves & Surplus: 150,000.00
Secured Loans: 200,000.00
Current Liabilities: 85,000.00
Sundry Creditors: 250,000.00
──────────────────────────────────────
TOTAL LIABILITIES: 1,185,000.00
══════════════════════════════════════
ASSETS SIDE
1. FIXED ASSETS
Plant & Machinery (FXAS00001)
Opening Balance: 250,000.00
Add: Total Debit: 50,000.00 (New purchase)
Less: Total Credit: 0.00
─────────────────────────────────
Closing Balance: 300,000.00
2. INVESTMENTS
Mutual Funds (INVT00001)
Opening Balance: 80,000.00
Add: Total Debit: 20,000.00 (Additional investment)
Less: Total Credit: 0.00
─────────────────────────────────
Closing Balance: 100,000.00
3. CURRENT ASSETS
CGST Input (CGST00002)
Opening Balance: 20,000.00
Add: Total Debit: 5,000.00
Less: Total Credit: 0.00
─────────────────────────────────
Closing Balance: 25,000.00
SGST Input (SGST00002)
Opening Balance: 20,000.00
Add: Total Debit: 5,000.00
Less: Total Credit: 0.00
─────────────────────────────────
Closing Balance: 25,000.00
IGST Input (IGST00002)
Opening Balance: 30,000.00
Add: Total Debit: 10,000.00
Less: Total Credit: 0.00
─────────────────────────────────
Closing Balance: 40,000.00
GRNI Account (GRNI00001)
Opening Balance: 30,000.00
Add: Total Debit: 5,000.00
Less: Total Credit: 0.00
─────────────────────────────────
Closing Balance: 35,000.00
Current Assets Group Total:
CGST Input: 25,000.00
SGST Input: 25,000.00
IGST Input: 40,000.00
GRNI: 35,000.00
───────────────────────
Total: 125,000.00
4. SUNDRY DEBTORS
XYZ Corporation (CUST00001)
Opening Balance: 150,000.00
Add: Total Debit: 30,000.00 (Sales)
Less: Total Credit: 0.00
─────────────────────────────────
Closing Balance: 180,000.00
5. CASH IN HAND
Cash Account (CASH00001)
Opening Balance: 40,000.00
Add: Total Debit: 10,000.00 (Cash received)
Less: Total Credit: 0.00
─────────────────────────────────
Closing Balance: 50,000.00
6. BANK ACCOUNTS
HDFC Bank Current Account (BANK00001)
Opening Balance: 300,000.00
Add: Total Debit: 80,000.00 (Deposits)
Less: Total Credit: 0.00
─────────────────────────────────
Closing Balance: 380,000.00
7. STOCK IN HAND
Finished Goods (STCK00001)
Opening Balance: 40,000.00
Add: Total Debit: 10,000.00
Less: Total Credit: 0.00
─────────────────────────────────
Closing Balance: 50,000.00
TOTAL ASSETS CALCULATION
Fixed Assets: 300,000.00
Investments: 100,000.00
Current Assets: 125,000.00
Sundry Debtors: 180,000.00
Cash in Hand: 50,000.00
Bank Accounts: 380,000.00
Stock in Hand: 50,000.00
──────────────────────────────────────
TOTAL ASSETS: 1,185,000.00
══════════════════════════════════════
BALANCE SHEET VERIFICATION
Total Assets: 1,185,000.00
Total Liabilities: 1,185,000.00
──────────────────────────────────────
Difference: 0.00
══════════════════════════════════════
Status: ✓ BALANCED
Key Formulas Reference
For Asset Accounts (Normal Debit Balance)
Closing Balance = Opening Balance + Debits - Credits
For Liability Accounts (Normal Credit Balance)
Closing Balance = Opening Balance + Credits - Debits
Balance Sheet Equation
Total Assets = Total Liabilities + Total Capital
If Not Balanced
Difference = Total Assets - Total Liabilities
If Difference > 0: Assets exceed Liabilities (Profit or missing liability)
If Difference < 0: Liabilities exceed Assets (Loss or missing asset)
Important Notes
1. Debit increases Asset accounts
2. Credit increases Liability and Capital accounts
3. All accounts start with an opening balance
4. Transactions during the period affect the closing balance
5. Balance Sheet must always balance (Assets = Liabilities + Capital)
6. Closing Balance becomes the Opening Balance for the next period