

THE TRIAL BALANCE 7& 



ILLUSTRATION 17 



STATEMENT OF RESOURCES AND LIABILITIES PREPARED FROM A 

 TRIAL BALANCE. 



STATEMENT OF RESOURCES AND LIABILITIES, 

 FEB. 28, 1917, MR. ARNOLD 



Resources 



Cash $1000 



Mr. Bell 500 



Horses 1600 



Cattle 1100 



Equipment 800 



$5000 



Liabilities 

 Mr. Arnold's 



capital Feb. 



28, 1916... $4000 

 Add net gain 



for year. . . 1000 5000 



$5000 



the credit side of one of the statements. No other amounts 

 appear in the statements except the net gain, which ap- 

 pears on the debit side of one statement and the credit side 

 of the other. Therefore, since the debit and credit totals 

 of the trial balance are equal, the debit and credit totals 

 of the two statements taken together are equal. That is, 

 the two statements are in balance.. The $1000 balance in 

 the Loss and Gain Statement is transferred to the State- 

 ment of Resources and Liabilities in much the same way 

 as it was transferred from Loss and Gain account in the 

 ledger to Mr. Arnold's Capital account. 



Stated in another way, the Statement of Resources and 

 Liabilities itself contains all the items of the trial balance. 

 It contains as separate items all the balances indicated in 

 the trial balance as resources or liabilities, and contains in 

 one amount the net result of all the other balances in the 

 trial balance. Thus, in Illustration 17, the $1000 added 

 to Mr. Arnold's capital is the net result of all the trial 



