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Trial Balance and Rectification of Errors — Account STD 11 Commerce — Question

CBSE BoardEnglish MediumSTD 11 CommerceAccountTrial Balance and Rectification of Errors1 Mark
MCQ
Errors which compensate the effect of each other are called $......$ errors.
  • ✓
    Compensating
  • B
    One sided
  • C
    Two sided
  • D
    Clerical
✓

Answer

Correct option: A.
Compensating
Accounting errors are classified as:
  1. Error of Principle
  2. Error of omission
  3. Error of commission
  4. Compensating error
Compensating error of those where one error compensate the other error. In this situation, trial balance does not have any difference.
For example, Sales of $Rs.450$ is recorded in the ledger of Ram as $Rs.4500,$ on the other side, Purchases of $Rs.450$ is recorded in Shyam's account as $Rs.4500.$
In such situation, a net effect of $Rs.4050$ is effected both the sides.

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