For those who run a manual system utilising the T-Account format, the way in which you balance the accounts within your ledger at the end of every month or period is a two part process.

1. You must subtract the smaller side from the larger and carry (Balance c/d = Balance Carried Down) the difference on the smaller side, and
2. You must then bring down (Balance b/d = Balance Bought Down) the difference in balance to the larger side to commence the next month / period.

An example is below, or view the PDF file

• Jun 01 Balance bought down from month of May in 'Cash at Bank' account,
• Two furniture purchases made to create a furniture account,
• The 'cash at bank' account has a larger debit than credit side,
• Minus the smaller credit from debit side,
• Carry over the difference to the smaller credit side to balance the account period,
• Bring down the difference to begin your next month / period to the larger debit side.

The same method is applied to all accounts within your ledger. Which ever side is the larger, credit or debit, your subtract the smaller and carry the difference to the smaller side, then bring down that difference to the larger side as the next months / period beginning balance.