An entry of revenue nature is posted as capital item. It is an example of
-
error of omission
-
error of commission
-
error of principle
-
compensating error
C
Correct answer
Explanation
The entries made in contravention of accounting principles are errors of principle.
Error of omission refers to complete/partial omission of transaction from the books of account. When an entry is posted with wrong amount or on wrong side, it is error of commission. Compensating errors are those which compensate the effect of another error.