Trial balance and errors Flashcards
Why might there be errors in the trial balance?
Something has gone wrong when the trial balance was prepared.
There are errors in the double entry, or the balancing of the T accounts.
What are the 7 ‘not revealed errors’?
Error of omission
Reversal of entries
Mispost/Error of commission
Error of principle
Error of original entry/transcription
Compensating error
Duplication error
What is an error of omission?
Where a transaction is completely missed out of the accounts.
What is reversal of entries?
Where the debit and credit entries are posted the wrong way round.
What is a mispost/error of commission?
Where one of the entries is posted to an incorrect account, but the account is of the same category.
What is an error of principle?
Where one of the entries is posted to an incorrect account, but the account is of a different category.
What is an error of original entry/transcription?
Where both the debit and credit entries are posted with the same, incorrect amount.
What is a compensating error?
Where two errors cancel each other out.
What is a duplication error?
Where an entire transaction is posted correctly, and then posted again.
