Special Purpose Subsidiary Books

  • Purchase Book is used for recording credit purchases of goods.
  • Posting to the party's account is done daily in this book with individual amounts on the credit side of their accounts.
  • Advantages of purchase book are that it is convenient to know the credit purchases at any point of time.It provides the compact information of various firms or parties, etc.  
  • Sales Book is the book kept for recording only the credit sale of goods in which the trader deals. Invoice is a document giving the details of goods bought as to their quantity, quality, brand, price, etc.
  • Purchases return or returns outward book is maintained to record the goods or materials returned to the suppliers that have been purchased on credit.
  • Sales return book or returns inward book is maintained to record the return of goods or materials sold on credit to customers.
  • A ‘Debit note’ is a document prepared in duplicate, by purchaser (Debtor) to inform the supplier (Creditor) that his account has been debited with the amount mentioned in the note.
  • A ‘Credit note’ is a document prepared in duplicate, by the seller (Creditor) to inform the buyer (Debtor) that his account has been credited with the amount.
  • Journal proper is a residuary book after the sub-division of journal and records only those transactions which cannot be recorded in any other subsidiary book.

To Access the full content, Please Purchase

  • Q1

    What is a Sales Book?


    A Sales Book is a book used to record all the credit sales of goods.

    View Answer
  • Q2

    What is a Purchase Book?


    A Purchase Book is a book used for recording all the credit purchases of goods.

    View Answer
  • Q3

    What are the other names used for Subsidiary Books?


    The other names used for Subsidiary Books are Daybooks or Special Journals.

    View Answer
  • Q4

    Name the different types of special purpose subsidiary books.


    Following are the most common subsidiary books used in a business:

    a) Cash Book

    b) Purchases Book

    c) Sales Book

    d) Purchases Return (Return Outwards) Book

    e) Sales Return (Return Inwards) Book

    f) Bills Receivable Book

    g) Bills Payable Book

    h) Journal Proper

    View Answer
  • Q5

    Give some advantages of Subsidiary Books.


    Advantages of Subsidiary Books are:

    a) Accounting work can be divided according to the ability of the person.

    b) Information relating to each class of transaction is available at one place.

    c) Accounting work is done more efficiently.

    d) Through internal check system, fraud and manipulation can be avoided to the great extent.

    e) Easy in posting the transactions to the Ledger because total of a particular book can be posted instead of posting every transaction.

    f) Flexibility as the number of books can be increased or decreased according to the needs of the particular business.

    View Answer