Accounts are prepared on weekly, fortnightly, monthly, quarterly or on daily basis. At the end ; of each period they are balanced. 

The balancing of the accounts is done in the manner given below: –

• The totals of the debit and credit of an account is calculated, to ascertain which one them is higher.

• The higher figure among debit and credit side is written in the grand total cello on both sides of the account, i.e., in debit and in credit side. 

• The next step is to ascertain the difference between the debit total and the credit total. This difference is called ‘Closing Balance’ or ‘Balance carried down’, and is denoted by‘Balance c/d’. 

• The ‘Balance c/d’ will be shown either in the debit or credit side, whichever totals up into lower amount. 

• If ‘Balance c/d’ is written in the debit side, then the balance is called ‘Credit balance’. On the other hand, if ‘Balance c/d’ is written in the credit side, then the balance is called ‘Debit Balance’. 

• On closing the account, ‘Balance c/d’ is brought forward to the subsequent period, and it is written as ‘Balance b/d’.

Usually, the closing balances of real and personal accounts are forwarded to the next period by this manner. For nominal accounts, Step lto 3 remain same and they are closed by transferring the closing balances either to Trading Account or to Profit and Loss Account.