Factors that Affects the Trial Balance Agreement


A very good number of errors in the books may or may not affect the agreement of the trial balance totals. The factors entail thus:- 

  • Where there is error of total omission. In this case, it may be that the vouchers that are relevant to that transaction are missed out completely. 
  • There may be duplication of transaction. This means that a transaction may be recorded twice in a book of account. in this case, two debit entries instead of one and two credit entries instead of one must be recorded in the relevant accounts.
  • Errors of original entry in this, case, it may occur where a transaction is recorded using a wrong figure and the same wrong figure is carried all through the accounts. For example, a credit sales to Nwaigwe & Co. for N250 being recorded both in the sales day book and in Nwaeze & Co. account as N520.
  • Error of commission. Here, it involves a situation where we record a transaction with the correct figure but to a wrong person’s account. For instance, crediting Ike’s account with N620 when it is infact Okey’s account that should have been credited with N620.
  • Error of principle: This is a serious error in accounts. it occurs when expenses for a norminal account are transferred into an asset account. For instance, where the cost of office furniture is debited to office furniture’s account. Note that cost of office furniture, should go to office furniture’s expenses account which is a norminal account and not to the office furniture’s account which is an asset account. 
  • Compensating error: Here, this aspect of errors occurs where an error in one account in the ledger is offset by another part of the ledger account. For instance, where the accounts clerk extracts the balance n the w2ges account (which is a debit balance)as N400 but the correct figure is N500. Again the same clerk extracts the balance in the sales account which is a credit balance, as N700 but the cored figure is N800.

Notice from here that the N100 shortage in the debit side is-offset by the N100 shortage in the credit side.

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