Question

If you found that the total of the debits column of the trial balance for a company is $200,000, while the total of the credits column is $180,000, what are some possible causes of this difference

Answer 1

Some accounting errors that cause the difference between the debits and credits columns of the trial balance are as follows:

• Data entry errors
• Errors of omission
• Errors of commission
• Errors of transposition of one side of the entry
• Compensating errors
• Errors of duplication
• Errors of principle
• Errors of entry reversal

These errors are called accounting discrepancies. They are not intentional mistakes, but they often occur.

Thus, to forestall accounting errors, every company requires good accounting software to record its transactions, while the accounting staff should be adequately trained.

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