Question

write a note on error of commission​

Answer 1

Answer:

An error of commission occurs when an amount is entered right and in the correct account but the value is wrong–i.e. it's subtracted instead of added or vice versa. For example, a payment is applied to the wrong invoice. The amount owing by the client will still be correct in the trial balance, obscuring the mistake.

Answer 2

ANSWER :

Errors of Commission are the errors or mistakes which arise due to some positive act on the part of the person responsible for the maintenance of books of accounts. Such mistakes are committed because of lack of proper accounting knowledge ignorance and carry snakes of accounting staff.

❖ Errors of Commission are further classified into four categories :-

• [1] Errors of Principle : When some fundamental principle of Accountancy is violated while recording in transaction, the error is termed as Errors of Principle.

• [2] Errors of Posting : If a transaction has been journalised or recorded in a subsidiary book, but has been posted wrongly in the ledger account, it is an Error of Posting.

• [3] Errors of Casting : The errors that occur due to short casting or excess casting in any subsidiary book or in any account in the ledger is termed as Errors of Casting.

• [4] Compensation Errors : When two or more errors are committed in such a way that the net effect of these errors on the accounts in nil, such errors are called Compensating Errors.

❖ Some example of Errors of Commission are as follows :-

• [a] Recording a transaction violating the fundamental accounting principle.

• [b] Posting an entry in the wrong side of an account.

• [c] Posting of a wrong amount in a ledger account from subsidiary book.

• [d] Mistake in casting or totalling of subsidiary book or ledger account.

• [e] Mistake in balancing of ledger accounts.

• [f] Posting an item twice in a ledger account from the subsidiary book.

• [g] Recording an item in a wrong account head.