If a credit purchase of machinery is recorded in purchase book instead of journal proper it is an error of _______.
Principle
The correct answer is option 2. This error is known as an error of principle, which occurs when a transaction is recorded in the wrong book due to an incorrect application of accounting principles. In this case, recording a machinery purchase in the purchase book, which is meant for purchases of goods, instead of the journal proper is an error of principle.
Important Questions from Rectification of Error
If the account of Mr. Jay was debited by Rs. 495 instead of being credited by Rs. 459, the rectification will be done by ______.
Errors committed because of failure to make a proper distinction between revenue and capital items are called _____.
Which of the following statement is TRUE in the context of type of errors made while recording a business transaction?
i) A sale of Rs. 500 made to Kamal has been posted on the debit side of Kishore's Account is an example of one-sided error.
ii) A payment of Rs. 1,000 towards interest was posted twice to Interest Account is an example of one-sided error.
Failure to differentiate between capital and revenue expenditure results in Errors of ______.
Which of the following error, will be rectified through suspense account?
