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Errors of Trial Balance

There are several types of errors that cannot be detected by a trial balance, including errors of principle where amounts are entered in the wrong account type, errors of commission where entries are made to the wrong account, and errors of omission where transactions are omitted entirely. Errors that can be detected by a trial balance include errors of calculation, omission on one side of an account, and transposition or transplacement of digits on one side of an account. When a trial balance does not balance, the difference between debit and credit columns should be determined and accounts rechecked in the ledger and journal to find the error.

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Caitlene Lee Uy
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645 views2 pages

Errors of Trial Balance

There are several types of errors that cannot be detected by a trial balance, including errors of principle where amounts are entered in the wrong account type, errors of commission where entries are made to the wrong account, and errors of omission where transactions are omitted entirely. Errors that can be detected by a trial balance include errors of calculation, omission on one side of an account, and transposition or transplacement of digits on one side of an account. When a trial balance does not balance, the difference between debit and credit columns should be determined and accounts rechecked in the ledger and journal to find the error.

Uploaded by

Caitlene Lee Uy
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Errors that cannot be detected by Trial Balance

1. ERROR OF PRINCIPLE
- happens if amount is entered in the wrong type (ALCIE) of account
- Principle wrong title, wrong type
2. ERROR OF COMMISSION
- entries are made at the correct amount and the appropriate side (debit or credit)
but one or more entries are made to the wrong account of the correct type
3. ERROR OF OMISSION
- when transaction is completely omitted from the accounting records
4. ERROR OF ORIGINAL ENTRY
- placing incorrect amount from the very start (journal)
- when both sides of the transaction include the wrong amount
5. ERROR OF REVERSAL
- when entries are made to the correct amount, but with debits instead of credits
and vice versa
6. TRANSPOSITION ERROR
- caused by switching the position of 2 adjacent digits. Since the resulting error is
always divisible by 9, accountants use this fact to locate the mis-entered number
7. TRANSPLACEMENT ERROR
- error where a slide occurs when some or all of the digits of a number are moved
one or more places to the left and right

Errors that can be detected by Trial Balance


1. Errors of calculation wrong footing
2. Error of omission on one side
3. Transposition of one side
4. Transplacement on one side
5. Posting to the same side of the account

When the Trial Balance is not Balanced


- recheck the footing of the debit and credit columns of the trial balance

- determine the difference between debit and credit columns. This is the difference by
which the trial balance is out of balance
- if the difference is divisible by 9 either transposition or transplacement happened
- recheck the accuracy of the transfer of the figures
- list a debit balance account in the balance column
- recheck the footing of the accounts in the ledger

when rechecking: Trial Balance Ledger Journal

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