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Which of the following types of error is never indicated when a trial balance is extracted?
Option
1. Errors of commission
2. Errors of omission
3. Errors of principle
4. Transposition errorsThe book said that the correct answer is error of principle. But do not understand why. If a revenue item is recorded as an expense item. The trial balance will indicate this type of error. I selected error of commission because if an asset was recorded as an expense the error will not be indicated by the trial balance
Suppose they buy a new asset but instead of debiting the asset account they instead debit an expense account. This is an error of principle but the trial balance will still balance because they have still had a debit and a credit.
Yes I’m sorry it’s an error of principle. But if I debited an expense account instead of another expense account. This will be an error of commission and it will still not be shown in a trial balance right
Please help me I’m still a bit confused about this question.
I’m still searching on that. If an income is treated as an expense. It’s an error of principle. And this type of error will create an inequality between the total debits and the total credits in a trial balance. So the trial balance do indicate an error of principle.
Your first post is correct.
For your second post, provided that the debit entry equals the credit entry then even if one of the accounts is the wrong account, the trial balance will still balance.
No it is an error of principle.
An error of commission is when it is posted to the wrong account. Even if the post is to the wrong side of the account then it is still an error of commission but the trial balance will not balance.
An error of principle is like this one, where (as in your example) it is (for example) posted to the debit side of an expense account when it should have been posted to the debit side of an asset account. In that case the trial balance will still balance.
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