Errors That Do Not Affect The Trial Balance - SS1 Accounting Past Questions and Answers - page 1
Which type of error in accounting does not affect the trial balance?
Errors of omission
Errors of commission
Errors of principle
Compensating error
What is an error of principle in accounting that does not affect the trial balance?
Recording an incorrect amount for a transaction
Recording a transaction in the wrong accounting period
Not following an accounting principle
Recording a transaction twice
What is the purpose of identifying and correcting errors in accounting that do not affect the trial balance?
To ensure the accuracy of financial information
To increase profits
To reduce expenses
To improve employee morale
What is the impact of compensating errors on the trial balance?
They cause an imbalance in the trial balance
They cancel each other out and the trial balance remains accurate
They affect only the credit side of the trial balance
They affect only the debit side of the trial balance
Which type of error in accounting affects the trial balance by recording a transaction in the wrong accounting period?
Errors of omission
Errors of commission
Errors of principle
Errors of timing
How can an error of principle in accounting affect a company's financial statements?
An error of principle can lead to inaccurate financial statements and misrepresentations of a company's financial position if not corrected. This is because the accounting principle was not followed, resulting in an error in the recording of the transaction.
What is the difference between an error of omission and an error of commission in accounting?
An error of omission occurs when a transaction is completely left out of the accounting system, while an error of commission occurs when an incorrect amount is recorded for a transaction.