Why don,t show the Closing stock in Trial Balance.
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Because trial balence is a balence/extract of every
ledger's balence ,each ledger having double effect which
goes to trial balence ,E.G for making payment one effect is
credit cash and dabit to party,every ledger with double
effect goes to only trial balence.
hence-closing stock is already included in
purchases+opening-Sales and each entry of three with double
effect shown in trial balence that is why closing stock is
not shown in trial balence.
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Answer / mr gvk
Closing stock comes in trading account.SO that profit can be ascertained for the concerned period.
Moreover , trial balance shows the balancing figures of the Items..
In one way, Closing stock is appearing in the trail balances via, sales ,purchases and opening stock. The difference of opening stock and sales added with opening stock gives closing balance figure.
It is a good Corporate practice to Include the closing stock as a foot note in down the sheet of trail balance.
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