Error disclose by a trial balance is:
Answers
Answer:
Though such errors occur in the books of accounts, the total of debit and credit balance will be the same. The trial balance will tally. Errors of complete omission, error of principle, compensating error, wrong entry in the subsidiary books are not disclosed by the trial balance.
Explanation:
Though such errors occur in the books of accounts, the total of debit and credit balance will be the same. The trial balance will tally. Errors of complete omission, error of principle, compensating error, wrong entry in the subsidiary books are not disclosed by the trial balance.
1. Wrong Totaling of Subsidiary Books:
If the total of any subsidiary book is wrongly cast, it would cause a disagreement in the Trial Balance. For instance, Sales book has been under cast by Rs 100. From the Sales book, all the personal accounts have been debited correctly but mistake occurred only in Sales Account, to the extent of Rs 100 (Less). Thus, the Trial Balance disagrees to the extent of Rs 100; credit side falls short of the amount.
2. Posting of the Wrong Amount:
If a wrong amount is posted in one of the two accounts, the Trial Balance disagrees. For instance sales made to Ram for Rs 570, wrongly debited to Ram’s Account with Rs 750, instead of Rs 570. Ram’s account has been over debited by Rs 180. Thus, the debit side of the Trial Balance will exceed by Rs 180. i.e., 750 – 570 = 180.
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3. Posting an Amount on the Wrong side of the Account:
For instance, a credit sales made to a customer for Rs 500 has been credited to the customer account, instead of debit. As a result of this error, the credit side of the Trial Balance will exceed by Rs 1,000 (double the amount of the error) because there are two credits one in Sales Account and another in Personal Account and no debit for the transaction.
4. Posting Twice to a Ledger:
For instance, salary of Rs 500 paid has been debited to Salary Account twice by mistake. This will cause disagreement of Trial Balance in debit side by excess of Rs 500.