Since a couple of days it\'s possible to use in-app-billing in Android apps. Very cool of course. So, I started working on a update for my application to implement this. But
I also encountered the same issue...but now issue is solved
My observations based on few trials:
Hope this helps
Old thread, but adding my experience...
I installed an apk with a versionCode 1 higher than was in the store. Played it on 2 different accounts on my Nexus 7 and experienced this problem. So I uninstalled and reinstalled from the store to make sure the versionCode matched. Even waiting overnight the error didn't clear.
Turns out I needed to uninstall from all 3 google accounts I have tied to my Nexus 7. It recovered when I uninstalled the app explicitly from all three accounts on my nexus 7 then reinstalled from the store.
This can happen on signed, released builds when the apk uploaded as a draft does not match the apk running on your system in test mode. Just make sure that your builds match up, you should be alright in test mode and will stop seeing the errors.
The big worry here is that we'll see this same behavior in production, i.e., we release 1.0.0-1 with in-app billing, then we release 1.0.0-2, and users running 1.0.0-1 will be unable to purchase or have their purchases restored and will receive the same error (very bad user experience). Have been scouring the docs for mention of this behavior as specific to test-mode, but no luck so far; we've added a bug here: http://code.google.com/p/marketbilling/issues/detail?id=15#c0
I have found that once I upload a new copy of my APK to the market, then I experience that "application error" during course of the next hour or so. After at least one hour has gone by (sometimes up to two hours need to have gone by), then I no longer get that error anymore and I can then purchase my items without any problems. It seems that the Google servers need at least an hour to process the fact that you have uploaded a new APK (with regards to the InApp Billing aspect of the APK).
So my advice is for you to wait 1 to 2 hours after uploading your APK, and then see if you still get the "application error".
Copied from duplicate question: https://stackoverflow.com/a/22469253/1321401
This error may occur for several reasons.
Here is the list of requirements for the Google IAB testing.
Prerequisites:
Testing requirements:
P.S: Debugging with release certificate: https://stackoverflow.com/a/15754187/1321401 (Thnx @dipp for the link)
P.P.S: Wanted to make this list for a long time already.
Thnx @zlgdev for update
To throw in my two cents, I was able to test it by uploading to the Beta version and creating a Gmail account with testing access under the settings tab with a new version of my app...
I'm now moving it to production...
Thanks! Nathan