Errors Not Reflected by Trial Balance

 

Errors Not Reflected by Trial Balance

1. Omission: In this case, if a transaction gets missed in its entirety; the same will not get detected by the trial balance.

2. Error of Principle: The trial balance will still match if a transaction gets recorded against the generally accepted accounting principle. The error of principle includes recording the Capital transaction as a revenue transaction in the books of accounts.

3. Error of Commission: Suppose Rs 5000 gets recorded as Rs 500 in both the debit and credit sides of the trial balance. The trial balance will fail to point out this error.

4. Compensating Error: In compensating error, one error compensates for another. For example, you did not debit the purchase account of Rs 1000 in one account but by mistake debited Rs 1000 in another account.

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