N/APosted on - 06/01/2020
Hello, I am an accounting student. I have just started studying accounting. There was a test in my college in which I failed to answer a question on ‘Types of Errors in Accounting.’ It would be helpful if someone explains the types of errors in accounting. Thank You.
Types of Errors in Accounting.
There are seven types of errors in accounting. They are as follows:
- The error of Omission: This error occurs when someone forgets to enter the details about a transaction in the register.
- The error of Reversal: The error of reversal occurs when a transaction is posted as the credit instead of being posted as a debit.
- The error of Principle: This is a technical error. This error occurs when someone wrongly applies an accounting principle.
- The error of Commission: When the right amount is entered at the wrong place, the error of commission occurs.
- Subsidiary Entry: This error occurs when entering a transaction.
- Rounding Error: Rounding error occurs while rounding off the amount.
- Transposition Error: The error occurs when two digits get reversed.