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Opening balance calculations
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Thu 12 Apr 2012 10:47 AM
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D.S
No Membership
11 posts
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Can somebody explain me how to calculate the opening balance. I can't find a good explanation on my course material. Please help me!!!
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Thu 12 Apr 2012 11:27 AM
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Brian @ Ideal Schools
Accredited Training Provider
183 posts
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Hi D.S,
Your question's a bit vague. What opening balance are you required to calculate.
Regards
______________________
Brian McVean
Course Advisor/Tutor
Ideal Schools, Glasgow
0141 248 5200
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Thu 12 Apr 2012 11:45 AM
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D.S
No Membership
11 posts
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Do I have to calculate the opening balance from assets and liabilties, or just liabilities? from where can I get the opening balance figure?
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Thu 12 Apr 2012 12:30 PM
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Brian @ Ideal Schools
Accredited Training Provider
183 posts
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D.S,
If you have been asked to calculate the Opening Capital, then you'd use the accounting equation: Assets - Liabilities = Capital. Unfortunately, I do not know who's course you are doing, or the specific question, but I hope this helps you.
Kind regards
______________________
Brian McVean
Course Advisor/Tutor
Ideal Schools, Glasgow
0141 248 5200
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Thu 12 Apr 2012 01:09 PM
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D.S
No Membership
11 posts
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The list of accounts in the opening trial balance represent?
Assets only,
assets and liabilities or
liabilities only.
Edited at 12 Apr 2012 01:11 PM GMT
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Thu 12 Apr 2012 04:10 PM
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Brian @ Ideal Schools
Accredited Training Provider
183 posts
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D.S,
Your trial balance should include both assets & liabilities. Are you using a provider? If so, perhaps you should get in touch with them.
Regards
______________________
Brian McVean
Course Advisor/Tutor
Ideal Schools, Glasgow
0141 248 5200
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Thu 12 Apr 2012 04:35 PM
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Caz
No Membership
26 posts
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Hi DS
I think I know where you are coming from:
In an exam paper, the list of balances you are given will comprise assets AND liabilities and from this list you are required to ascertain the value of capital? Is that the right question?
If this is the correct question then you have to add up all the assets and then add up all the liabilities: Subtract the liabilities from the assets to give you the figure for the Opening balance on the capital account.
For example:
| Capital |
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You need to determine this |
| Machinery |
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10,000 |
| Office Equipment |
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5,000 |
| Debtors: |
Miriams Ltd. |
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600 |
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The Tote Bag |
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750 |
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Rock ‘n’ Sweets |
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1,050 |
| Bank |
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1,200 |
| Cash |
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45 |
| Creditors: |
Copper Tops Ltd. |
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240 |
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Pipers Plastics |
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870 |
| VAT Liability |
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1,220 |
If you add up all the assets you get £18,645 and the liabilities equal £2,330 which means that Capital equals:
18645 - 2330 = £16,315
Assets - Liabilities = Capital
I hope this helps.
Edited at 12 Apr 2012 04:37 PM GMT
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Sat 14 Apr 2012 06:46 PM
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D.S
No Membership
11 posts
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Brian @ Ideal Schoolssaid:
“D.S,
Your trial balance should include both assets & liabilities. Are you using a provider? If so, perhaps you should get in touch with them.
Regards”
Hi Brian,
I am using a provider but I have addressed my doubt on tuesday but until now I have no response. Thanks for your help anyway.
Edited at 14 Apr 2012 06:52 PM GMT
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Sat 14 Apr 2012 06:50 PM
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D.S
No Membership
11 posts
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Cazsaid:
“Hi DS
I think I know where you are coming from:
In an exam paper, the list of balances you are given will comprise assets AND liabilities and from this list you are required to ascertain the value of capital? Is that the right question?
If this is the correct question then you have to add up all the assets and then add up all the liabilities: Subtract the liabilities from the assets to give you the figure for the Opening balance on the capital account.
For example:
| Capital |
|
|
You need to determine this |
| Machinery |
|
|
|
10,000 |
| Office Equipment |
|
|
5,000 |
| Debtors: |
Miriams Ltd. |
|
600 |
| |
The Tote Bag |
|
|
750 |
| |
Rock ‘n’ Sweets |
|
|
1,050 |
| Bank |
|
|
|
|
1,200 |
| Cash |
|
|
|
|
45 |
| Creditors: |
Copper Tops Ltd. |
|
|
240 |
| |
Pipers Plastics |
|
|
870 |
| VAT Liability |
|
|
1,220 |
If you add up all the assets you get £18,645 and the liabilities equal £2,330 which means that Capital equals:
18645 - 2330 = £16,315
Assets - Liabilities = Capital
I hope this helps.
Edited at 12 Apr 2012 04:37 PM GMT”
Hello Caz,
Thanks for your help.
Edited at 14 Apr 2012 06:54 PM GMT
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Thu 26 Apr 2012 03:57 PM
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Mandy S
No Membership
32 posts
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think this is a topic i am stuck with too
on level 1 exam
" what would be the total balancing figures on the opening trial balance"
you are given lots of figures i.e. capital, sales, purchase, debtors, vat, creditors etc
So is it the scenario:- "assests minus liabilities = capital"
so would that capital figure by my opening balance?
______________________
Mandy S
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