What are the different types of errors that are usually committed in recording business transaction

Explanation

Keeping in sight the character of errors, all the errors are often classified into the subsequent four classes

(i) Errors of Omission: The errors of omission ar usually committed at the time of recording the dealings within the books of original entry or whereas posting to the ledger. this will any be classified into 2 totally different classes

(a) Error of complete omission

(b) Error of partial omission When a dealings is totally omitted from recording within the books of original record, it's a blunder of complete omission and once the recording of the dealings is partially omitted from the books, it's a blunder of partial omission.

(ii) Errors of Commission: These ar the errors that ar committed because of the incorrect posting of transactions, wrong totalling or equalisation of the accounts, the incorrect casting of the subsidiary books or wrong recording of the number within the books of original entry etc.

(iii) Errors of Principle: Accounting entries ar recorded as per the commonly accepted accounting principles. If any of those principles we tend to profaned or unheeded, errors ensuing from such violation ar referred to as errors of principle. a blunder of principle might occur because of incorrect classification of expenditure or receipt between capital and revenue. this can be important as a result of it'll have an impression on money statements. it's going to cause under/over slating of financial gain or assets or liabilities etc.

(iv) Compensating Errors: once 2 or additional errors ar committed in such how that net impact of those errors on the debits and credits of accounts is cipher. such errors ar referred to as compensating errors.