2. Subsidiary Book
Subsidiary Books are books of Original Entry.
They are also known as Day Book or special journals.
We record transactions of similar nature are in Subsidiary
Books.
They are helpful in overcoming the limitations of journal book or
journal entries
Subsidiary book is the sub division of Journal.
3. Division of work
Quickly detection of errors
Easy to access the detailed information relating to a particular
transaction
Helps to save time and labor by recording similar type of
transactions in a separate book
Possibility of Internal Check
Why Subsidiary Books Are Important
4. Cash Book
• Single Column
• Double Column
• Triple Column
• Petty Cash Book
Other Subsidiaries
Book
• Purchase Book
• Sales Book
• Purchase Returns Book/ Return
Outward Book
• Sales return Book/ Return Inwards
Book
• Bill Receivable Book
5. All credit purchases of goods are recorded in the purchases journal
whereas cash purchases are recorded in the cash book.
Other purchases such as purchases of office equipment, furniture,
building, are recoded in the journal proper
It is also known as Purchase journal
1. Purchase Book
Format
6. All credit sales of merchandise are recorded in the sales journal.
Cash sales are recorded in the cash book.
Sales book is also called a Sales Journal or Sales Day Book.
2. Sales Book
Format
7. In this book, purchases return of goods are recorded.
Sometimes goods purchased are returned to the supplier for
various reasons such as the goods are not of the required quality,
or are defective, etc.
Purchase returns are also called Returns Outward Book
3. Purchase Returns Book
Date Particulars Debit Note
No
L.F Details Amount
Note: A column for “Remarks” can also be added to the purchase book which would include a brief
description of the reason for why the goods were returned.
Format
8. This journal is used to record return of goods by customers to
them on credit.
buyer may return goods due to poor quality, inaccurate quantity,
untimely delivery or other reasons.
It is also called Returns Inwards Book
4. Sale Returns Book
Note: A column for “Remarks” can also be added to the Sales return book which would include a
brief description of the reason why the goods were returned.
Date Particulars Credit Note
No
L.F Details Amount
Format
9. Bills receivable book is used to record the bills received from
debtors. When a bill is received, details of it are recorded in the
bills receivable book.
If the bills are received against credit sales, the seller may
record the same in Bill receivable book
The total value of all the bills receivable for an accounting period
is transferred to the books of accounts.
5. Bill Receivable Book
10. Bills payable book is used to record bill accepted by us. When a
bill drawn by our creditor is accepted particulars of the same are
recorded in this book.
The total value of all the bills payable for an accounting period is
transferred to the books of accounts.
6. Bill Payable Book
11. Cash Book
Cash book is a book in which all transactions relating to cash
receipts and cash payments are recorded
It works as a book of original entry as well as a ledger account
12. Parameter of
Comparison
Cash Book Cash Account
Purpose It serves dual purpose of journal and
ledger. No need for cash transactions to be
recorded in journal.
It only serves the single purpose of a
ledger.
Types There are three types of cash books:
single, double and triple column cash
books.
There is only one type of cash
account
Narration Cash books have narration which come
after the entries
Cash accounts are not followed by
narration
Dependency Cash books are not dependent on any
other book because it is the book of
original entry
Cash accounts are dependent on
journal day
Order of recording The recording of transactions is done
directly in a cash book
The cash transactions are first
recorded in a journal book and later
recorded in the cash account
Difference B/W Cash Book & Cash Account
14. This cash book will only record cash transactions.
The cash coming in (receipts) will be on the left and the cash
payments will be on the right.
Do not record bank transactions in this cash book.
Any discounts given will also not feature here.
1. Single Column Cash Book
Date Particulars LF. Cash Date Particulars LF. Cash
Format
15. Here instead of one column, we have an additional column
for discounts.
So along with the cash transactions, we will also record the
discounts in the same cash book.
So both discounts received and the discount allowed is
recorded here.
2. Double Column Cash Book
Date Particulars LF. Discount Cash Date Particulars LF. Discount Cash
Format
16. a triple column cash book has “Cash”, “Bank” and “Discount
Allowed” on the receipt on the left side
and “Cash”, “Bank” and “Discount Received” on the payments
are on the right side of the cash book.
Cash discount is recorded, when payments are made in cash or by
check.
3. Three Column Cash Books
Format
Date Particulars LF. Discount Cash Bank Date Particulars LF. Discount Cash Bank
17. Contra Entry
Contra entry refers to transactions involving cash and bank
account.
In other words, any entry which affects both cash and bank
accounts is called a contra entry.
Contra in Latin means the opposite.
It is more popularly known as contra voucher.
1. Cash 50,000 withdrawn for an official purpose from the bank. Journal entry
for this transaction will be
Cash A/C 50,000
To Bank A/C 50,000
Example
18. The book in which those small payments are recorded, which
are not convenient to record in main Cash Book, is
called petty cash book.
Petty Cash Book is maintained to record small expenses such as
postage, stationery, telegram.
A separate column is allotted for each type of expenditure.
The difference between the total of the debit items and that of the
‘total column’ on the credit represents the balance of the petty
cash in hand.
Petty Cash Book
