What is the error when a transaction is entered into the wrong account but of the same type and therefore will not show in the trial balance?

What is the error when a transaction is entered into the wrong account but of the same type and therefore will not show in the trial balance?

• A. Error of Principle
• B. Clerical error
• C. Fraud
• D. Compensating error

Answer: (A)

The situation described is a clerical misposting within the same class of accounts. When a transaction is entered into a different account of the same type (for example, an expense recorded in Advertising instead of Travel), the double-entry is still recorded correctly with debits and credits, so the trial balance totals remain equal. That means the error won’t be detected by the trial balance alone, even though the wrong ledger account is affected and the accounts’ balances are inaccurate until corrected. This isn’t an error of principle, which would mean recording a transaction in an account of a different type (such as treating an expense as an asset or recording revenue as a liability). It’s simply a misposting to the wrong account within the same category.

The situation described is a clerical misposting within the same class of accounts. When a transaction is entered into a different account of the same type (for example, an expense recorded in Advertising instead of Travel), the double-entry is still recorded correctly with debits and credits, so the trial balance totals remain equal. That means the error won’t be detected by the trial balance alone, even though the wrong ledger account is affected and the accounts’ balances are inaccurate until corrected.

This isn’t an error of principle, which would mean recording a transaction in an account of a different type (such as treating an expense as an asset or recording revenue as a liability). It’s simply a misposting to the wrong account within the same category.