Question

An error of principle, such as debiting an asset account instead of an expense account, will not affect the agreement of the trial balance.

Options

• True

• False

Answer 1

True

Explanation:

An error of principle occurs when an accounting principle is violated, for example, debiting an asset account instead of an expense account.
Although the classification is wrong, the debit and credit amounts remain equal, so the trial balance still agrees, and the error goes undetected through it.