In our article (General Journal), we have discussed that businesses are recorded their transactions at first instance in the journal but that single journal is mostly used by the small business. The larger businesses using separate books of prime entry for different nature of transactions which are called the subsidiary books. In such books, the respective entry is posting in its respective books, not like the way small businesses record all nature of transactions in a single general journal.
Following are the main subsidiary books that can be used by the businesses for the recording of the specific nature of transactions. Let’s have a look into such types of specialized books.
SALES VOUCHER
All credit sales are recorded in the sales day book and are also posted in the individual accounts in the sales ledger. Then at the end of each period (weekly, fortnightly, or monthly) total sales and total debtors are posted to the sales account & total debtors account respectively in the general ledger. Remember that cash sales are recorded directly on the receipt side of the cash book.
PURCHASE VOUCHER
All credit purchases are recorded in the purchases day book and are also posted in the individual account Purchases ledger. Then at the end of each period (weekly, fortnightly, or monthly), total purchases of any creditors are posted to the purchases account & total creditors account respectively in the general Remember that cash purchases are recorded directly on the payment side of the cash book.
CASH VOUCHER
All cash transactions (receipts or payments) are recorded in the cash column of the cash book from where n1 total of expenses, incomes, etc. are posted to relevant accounts in the general ledger. Whereas balance at the end of an accounting period is directly taken into trial balance.
BANK VOUCHER
All banking transactions (receipts or payments) are recorded in the bank column of the cash book from a monthly total of expenses, incomes, etc. are posted to relevant accounts in the general ledger. \m closing balance at the end of an accounting period is directly taken into trial balance.
PETTY CASH VOUCHER
This book is prepared for recording small (petty) expenses. The monthly total of expenses is posted to the accounts in the general ledger & the closing balance of petty cash is taken into trial balance.