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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
When two or more errors are committed in such a way the effect of one error is compensated by another error. Which type of error is this?
  • A
    Error of Commission
  • ✓
    Compensating Error
  • C
    Error of Principle
  • D
    None of these
✓

Answer

Correct option: B.
Compensating Error
When an error is compensated by another error, it is called a compensating error.
For example, an amount of Rs.5000 received from Ram is credited to his account as Rs.500, on the other hand, an amount of Rs.5000 paid to Sunil is debited to his account as Rs.500.

In this case, one short credit of Rs.4500 is compensated by short debit of Rs.4500.

One error has compensated the other error.

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