Correction of Errors

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  • Some errors not apparent because columns of Trial Balance will still agree
  • Some errors will be apparent because columns of Trial Balance do not agree

Errors which cause Trial Balance totals to not agree

  • Only one entry made not both
  • Both entries made on same side e.g. both debit
  • Entry made on debit side different value to the one on the credit side
  • Entries correct but balancing off is wrong, Overcast/Undercast

Correcting errors requires use of Suspense Account

Errors which do not affect the totals of Trial Balance

  • Error of omission - Not been recorded at all
  • Error of commission - Transaction involving individual debtor/creditor has been recorded in wrong individual account, other side correctly recorded
  • Error of principle - Recorded in wrong type of account
  • Error of complete reversal - Both sides of transaction recorded in right accounts but wrong way round
  • Error of original…

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