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Day One

Dr. Account A . . . . . . . . . 1,000

Cr. Account B . . . . . . . . . . 1,000

The above activity yields the following results:

Day 1 Account Balances
	Activity	End-of-Day Balance	Aggregate Balance	Average Balance
Account A	1000	1,000	1,000	1,000
Account B	(1,000)	(1,000)	(1,000)	(1,000)

Note that on day one the aggregate balance for each account is the same as the end-of-day balance. The average balance equals the aggregate balance divided by 1, the number of days in the period.

Day Two

Dr. Account A . . . . . . . . . 100

Cr. Account C . . . . . . . . . . 100

The above activity yields the following results:

Day 2 Account Balances
	Activity	End-of-Day Balance	Aggregate Balance	Average Balance
Account A	100	1,100	2,100	1,050
Account B	0	(1,000)	(2,000)	(1,000)
Account C	(100)	(100)	(100)	(50)

Note that the aggregate balance for each account equals the end-of-day balance for day 1, plus the end-of-day balance for day 2. Another way to state this is: aggregate balance equals the previous aggregate balance plus the current day's end-of-day balance. The average balance for each account equals the aggregate balance divided by 2, the number of days in the period-to-date.

Day Three

Dr. Account B . . . . . . . . . 200

Cr. Account C . . . . . . . . . . 200

The above activity yields the following results:

Day 3 Account Balances
	Activity	End-of-Day Balance	Aggregate Balance	Average Balance
Account A	0	1,100	3,200	1,066.66
Account B	200	(800)	(2,800)	(933.33)
Account C	(200)	(300)	(400)	(133.33)

Note that the aggregate balance for each account equals the sum of the end-of-day balances for days 1 through 3. The average balance for each account equals the aggregate balance divided by 3, the number of days in the period-to-date.

See Also

Example: Period Average-to-Date Balance

Example: Quarter Average-to-Date Balance

Example: Year Average-to-Date Balance