| Earlier article on errors of omission refers.
What are errors of omission?
Errors of omission:-
- pertains to transactions in primary books of accounts or in posting to the ledger
- can be total or partial
- errors of total omission WILL NOT affect the agreement of trial balance
- errors due to partial omission WILL affect the trial balance. Remedy is to pass the normal journal entry and posting to the relevant ledger account or by making necessary adjustments.
Examples of TOTAL omission:
- Credit sale of $x to Mr AB is omitted from being recorded in the books of accounts re: no entry is recorded in the credit side of sales account and debit side of receivables account – do not affects the agreement of trial balance
Examples of PARTIAL omission:
- $x received from Mr CC ( receivable account) is correctly posted to the cash book but the posting to the receivable account in the ledger is omitted.- affects the trial balance.
|