Ending account balance

Definition

An ending account balance is the amount of money in an account at the end of a specified period, such as a month or year. It reflects all transactions that have occurred within that period, including debits and credits.

5 Must Know Facts For Your Next Test

1. The ending account balance is found on the balance sheet and reflects the financial position of an entity at a specific point in time.
2. It includes all transactions up to the closing date, such as deposits, withdrawals, and interest earned.
3. This balance helps in reconciling accounts and ensuring accuracy in financial statements.
4. Ending balances from one accounting period become the beginning balances for the next period.
5. Understanding how to calculate and interpret ending balances is crucial for accurate financial reporting.

Related terms

Beginning Account Balance: The amount of money in an account at the start of a specified period before any transactions are made.

Trial Balance:

A bookkeeping worksheet listing all ledger accounts and their balances at a particular date, used to verify that total debits equal total credits.

General Ledger:

The master set of accounts that summarize all transactions occurring within an entity's accounting system.