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Secondary Books. Primary Books. Journal is a book of original entry or systematic recording of transactions. ‘Jour’ means ‘a day’ in french, so journal is a day book in which transactions are first entered according to rules of debit & credit. The entry made is known as journal entry.
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Primary Books • Journal is a book of original entry or systematic recording of transactions. • ‘Jour’ means ‘a day’ in french, so journal is a day book in which transactions are first entered according to rules of debit & credit. • The entry made is known as journal entry. • The process of writing the journal entry is called journalizing. • Journal is subdivided into several books like sales book, cash book, bills receivable & payable books, return inward & return outward books, journal proper, etc.
Q.9 Journalise the following transactions in the books of Harinam Singh for the month of April, 2005
RULES OF DEBIT AND CREDIT (as per traditional approach) • For Personal Account: Debit the Receiver Credit the giver • For Real Account: Debit what comes in Credit what goes out • For Nominal Accounts: Debit all expenses and loses Credit all incomes and gains
PRINCIPAL BOOKS LEDGER SUBSIDIARY BOOKS CASH BOOK. BANK BOOK. PURCHASE BOOK. SALES BOOK. PURCHASE RETURN BOOK. SALES RETURN BOOK. BILLS RECEIVABLE BOOK. BILLS PAYABLE BOOK. JOURNAL PROPER. Financial accounting books
Purchase Book • It is also called purchase journal. • It records only credit purchase of goods. • Whenever some goods are purchased goods account is debited and suppliers’ account is credited.
Sales Book • It contains details of credit sales of goods. • The parties to whom credit sales are made is known as debtors. • Sales account shows credit balance and debtor account shows debit balance.
Purchase return book • It records purchase returns to the suppliers. • If the goods are returned a debit note will be sent and the no. of debit note is recorded in the purchase return book.
Sales return book • When customers send the goods sold to them back to us it is recorded in sales return book. • A credit note is prepared to show the details of the items or goods. • Goods are received from the customers and a credit note is sent to them.
Q.10 Record the following transactions in the books of Ramchandra and Sons and show the totals of each book for the month of January, 2000
Bills receivable book : - It records the details of the bills receivable. - It shows debit balance and the amount receivable against them. Bills payable book : - It records the details of the bills accepted by the proprietor. - It shows credit balance and therefore it is a liability.
Cash Book • It is a book of original entry and records all cash receipts and cash payments made during a particular period. • It has two sides : Left side is receipt and right side is payment. • It is of 3 types : Single column cash book & two column cash book and three column cash books.
Q.11 Enter the following transactions in the single column cash book of Gopichand for March 2003
Q.12 Record the following transactions in two column cash book in the books of Soft Silk Co., for the month of July, 2004.
Q.13 Enter the following transactions in the cash book with discount, cash and bank columns
Petty Cash Book • Record of petty expenses • Petty Cashier helps the main cashier • Petty expenses are classified under several heads and recorded in analytical columns • Subsequently the posting takes place to General Ledger.
Enter the following transactions in an analytical petty cash book for November 2005 • 1st received a cheque for petty cash 1000 • 2nd paid bus fare to messengers 50 • 4th paid auto fare 70 • 10th postal stamps purchased 80 • 12th paid for stationery 90 • 15th paid for carriage 60 • 16th purchased envelopes 50 • 20th wages paid 100 • 25th tips given to driver 50 • 30th telephone calls paid 20
