Trial balance — common mistakes

To correctly classify balances, use the DEAD CLIC mnemonic. DEBIT balances are for Expenses, Assets, and Drawings. CREDIT balances are for Liabilities, Income, and Capital. This will help you quickly and accurately place items in the correct column under exam pressure.

A difference in the trial balance that is divisible by 9 is a strong indicator of a transposition error. A difference that is an even number could suggest a debit entry was posted as a credit (or vice versa), as the difference would be double the original amount.

When calculating corrected profit, create a clear working schedule. Start with the original profit and list each correction with its effect (+ or -). This reduces the chance of calculation mistakes and can earn partial marks.

Not necessarily. A balanced trial balance only confirms the arithmetical equality of debits and credits. It does not detect errors where the double-entry rule was followed but applied incorrectly, such as errors of principle, commission, omission, or original entry. The accounts could still contain significant mistakes.

This is a classic sign of a transposition error, where two digits in a number are swapped (e.g., $45 is written as $54). The mathematical difference between the original number and the transposed number is always a multiple of 9 (e.g., 54 - 45 = 9). This property is a useful clue for accountants when searching for errors.

No. An error of principle involves debiting or crediting the wrong class of account (e.g., debiting motor expenses instead of motor vehicles). A debit and a credit of equal value were still posted, so the trial balance would have balanced. The correction is made with a journal entry that debits the correct account and credits the incorrect account, without involving the suspense account.

An error of commission is posting to the wrong account but of the correct type. For example, a sale to John Smith is posted to Jane Smith's account; both are trade receivable accounts. An error of principle is posting to the wrong type of account entirely. For example, buying a computer (asset) and posting it to office expenses (expense).