Amount of Rs. 15000 taken for personal use from business account recorded as business expenses. This is an error of ______.

omission

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commission

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principle

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compensating

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Solution

The correct option is C principle
The amount of 15,000 taken for personal use for business account should have been debited to drawings account, but is debited as business expenses.
This is an error of principle. An error of principle occurs when an entry has been passed in the wrong account. These errors violate the basic fundamentals of accounting.

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