What are the that do not affect trial balance?

In accounting, each and every economic event or transaction is recorded in the books of accounts. Sometimes, accountants mistakenly omit or forget to record some entries. In some other cases, accountants do record all entries. However, entries are recorded in the wrong account or accounts are being credited / debited with wrong amounts. Whatever the case might be, we have to correct these errors otherwise our financial statements will not reflect the true and fair view of business. This is what we do in “rectification of errors” i.e. correcting mistakes that we have made while passing entries in the accounts.   Errors that don’t affect the agreement of a trial balance   Though, we had made some mistakes while recording entries in accounts, the debit side and credit side of a trial balance are still equal. We would discuss theses types of errors in this chapter   Rectification or correction of errors   Well, accountants do not correct errors by   • Tearing out accounts • Crossing values or amounts of accounts • Using chemicals or erasers / removers • Throwing them away or burning them • Destroying them using weapons of mass destruction   In contrary to this, accountants simply make some double or journal entries which automatically correct errors   The entry used to correct errors is referred to as rectifying entry   Different types of errors which don’t affect the trial balance agreement   1 Error of omission Wherein the full transaction is omitted from the books of accounts. For example sold goods to Mr. Z for $100. We neither entered this transaction in sales account nor have we entered in Mr. Z account   2 Error of commission Kind of error where we have entered the correct amounts but in wrong person’s account. For example sales of goods to Mr. A were entered in Mr. B account   3 Error of principle This type of error takes place when an item is entered in wrong head or class of accounts. For example purchase of fixed asset is entered in expenses account or sale of fixed asset such as building is entered in sales account   4 Error of compensation Errors that cancel the effects of each other. For example we might overstate purchases account by $20 and we can overstate sales account by $20 as well. Since we have added $20 to both debit and credit sides of trial balance, the agreement of trial balance is still intact.   5 Error of complete reversal of entries These errors occur when we debit and credit the two or more aspects of a transaction wrongly using correct figures or amounts. Forexample we have received cash $500 from Mr. Z. The correct entry should be Cash=Debit and Mr. Z=Credit but we have recorded as Mr. Z=Debit and Cash=Credit. However, the trial balance appears to be balance.   6 Error of original entry Entering wrong original figure or amount in accounts. For example, a purchase of $100 was entered as $200 in the books of accounts. A $30 sale to Mr. Z was wrongly entered as $50 in sales account and Mr. Z account   7 Error of transition Error of transition can be defined as switching the sequence of digits of amount or figure of a transaction. For example sales amount to $123 were entered as $321. A purchase of equipment worth $72 was entered as $27 in equipment account and cash account respectively.   This is one of the most common errors and it’s very hard to trace. When both debit and credit of a transaction is affected by the error of transition, trial balance’s debit and credit sides would be equal