subsidiary books bba.com
TRANSCRIPT
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SUBSIDIARY BOOKS
In business most of the transactions relate toreceipt of cash, payments of cash, sale of goods
and purchase of goods. So it is convenient tohave separate books for each such class oftransaction, one for receipts and payments ofcash, one for purchase of goods and one for sale
of goods. These books are called subsidiarybooks.
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TYPES OF SUBSIDIARY BOOKS
Cash Book: Recording all Cash receipts & cashpayments
Purchase Day book Recording all credit
purchasesSale Day Book Recording all credit sales
Purchase Return Book Recording all Purchasereturn
Sales Return book Recording all Sales return
Bills Receivable book - Recording allReceivable
Bills Payable book - Recording all Payable
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CASH BOOK
Cash book is a subsidiary book, which
records the receipts and payment ofcash. With the help of cash book cashand bank balance can be checked at
any point of time.
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TYPES OF CASH BOOK
Cash book can be of Three types:
1. Simple (single column) Cash Book.2. Two column (Double column) cash book.3. Three column (Triple column) cash book.
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SIMPLE (SINGLE COLUMN)
CASH BOOK
A simple (Single column) cash book isprepared like any ordinary account.The receipts are recorded in the Drside and the payments are recorded in
the Cr side of the cash book.
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SIMPLE CASH BOOK
Format: Simple (Single column cash book)
Date Particulars Amt. Date Particulars Amt.
To bal b/dTo.To
XxxXxxxxx
ByBy.By bal. c/d
XxxXxxxxx
xxx xxx
Simple Cash BookDr. Cr.
The opening balance of cash is recorded in Dr.side
All receipts are recorded in Dr side
All payments are recorded in Cr side
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SIMPLE CASH BOOK
Balancing the Cash Book
The Cash book is balanced like anyother account. The receipts columntotal will be more than the paymentscolumn total. The difference will bewritten on the Cr. Side as By Bal c/d.
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ILLUSTRATION
Enter the following transactions in simpleCash Book.
2006
Jan 1 Cash in hand 12000
Jan 5 Received from Ramesh 3000
Jan 7 Paid Rent 3000 Jan 8 Sold goods 7000
Jan 10 Paid Sohan 2000
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SIMPLE CASH BOOK
Solution:
Date Particulars Amt. Date Particulars Amt.
1-1-20055-1-20058-1-2005
To bal b/d
To Ramesh
To Sales
12000
3000
7000
7-1-200510-1-200531-1-2005
By Rent
By Sohan
By bal. c/d
3000
2000
17000
22000 22000
Simple Cash BookDr. Cr.
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Exercise:
Enter the following transactions in thesimple cash book.
2005
Dec 1. Cash in Hand 10,000
Dec 2 Received from Ramesh 13,000
Dec 3 Purchased Furniture 15,000
Dec 4 Machinery Sold 10,000
Dec 5 Goods sold 20,000
Dec 6 Salaries paid 1,000
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TWO COLUMN CASH BOOK
A two column cash book recordsdiscount allowed and discount receivedalong with the cash payments and cash
receipts.Note:Discount columns are not balanced they
are only totaled
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TWO COLUMN CASH BOOKFormat: Two (Double) column cash book
date
Particulars
discount
cash date
Particulars
discount
cash
To bal b/dTo .. xx
XxxXxx
ByBy bal. c/d
xx XxxXxx
xx xxx xx xxx
Two Column Cash BookDr. Cr.
All receipts are recorded in Dr side (cash column)All payments are recorded in Cr side (cash column)The discount columns are totaled but notbalanced.The cash columns are balanced in the samemanner as indicated for the simple cash book.
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ILLUSTRATIONS Enter the following transactions in a two-column cash
Book. 2005 Jan 1 Cash in hand 15,000 Jan 5 Paid to Mohan 3,000
Discount allowed by him 100 Jan 6 Purchased goods 4,000 Jan 10 Received from Vijay 9,800
Discount allowed 200 Jan 11 Sold goods 4,000
Jan 12 Paid to Shyam 2,950 Discount received Rs. 50 Jan 13 Paid wages 500 Jan 14 Paid to Rajesh Rs 3900 in full settlement of his
Account, which shows a Cr. Balance of Rs. 4000
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TWO COLUMN CASH BOOKSolution:
date Particulars
discount
cash date Particulars discount
cash
1-1-200510-1-200511-1-2005
To bal b/d
To vijay
To sales
200
15000
9800
4000
5-1-20056-1-200512-1-200513-1-200514-1-200531-1-2005
By Mohan
By Purchase
By shyam
By Wage
By Rajesh
By bal. c/d
100
50
100
3000
4000
2950
500
3900
14450
Two Column Cash BookDr. Cr.
E i
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Purchased Furniture
Purchased Goods
Sold Goods for Cash
Purchased Goods
Paid Cash to Ram
Discount allowed by him
Received Cash from Kaviraj and Co.Allowed Discount
Paid for petty exp.
Cash Purchases
Cash Sales Recd from Ram & Sons
Paid for Typewriter
Paid for Telephone
Paid Aggarwal brothers
They allowed discount
April 1
April 2
April 3
April 4
April 5
April 6
April 7
April 8
April 9
April 10
April 11
April 12
April 13
2,500
3,000
1,500
2,000
5,600
100
6,000
200
150
1,500
2,0006,000
8,000
2,000
4,000
Exercise:
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THREE COLUMN CASH BOOK
A three column cash Book is a cashbook, which contains bank columnalong with cash and discount columns.
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THREE COLUMN CASH BOOKFormat: Three (Triple) column cash book
date
Particulars
discount
bank cash date
Particulars
discount
bank cash
To bal b/d
ToTo bal. c/d
Xxx
Xxxxxx
Xxx
..
By
By bal. c/d
xx Xxx
xxx
Xxx
Xxx
xx xxx xxx xx xxx xxx
Two Column Cash BookDr. Cr.
All bank receipts are recorded in Dr side (bank cloumn)All bank payments are recorded in Cr side (bank column)All Cash receipts are recorded in Dr side (cash cloumn)All cash payments are recorded in Cr side (cash column)
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- The discount columns are totaled but not balanced.
- The cash columns are balanced exactly in the
same manner as indicated for the simple cash book.
The process is similar for balancing the bank
columns also. It is possible, that the bank may allow
the firm to withdraw more than the amount
deposited, i.e. to have an overdraft. In such a casethe total of the bank column on the credit side will
be bigger than the one on the debit side. The
difference is written on the debit side as To Bal
c/d.
BALANCING THREE COLUMN CASH BOOK
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THREE COLUMN CASH BOOK- Contra entry
1) When cash is paid into bank the entry passed
isBank A/C Dr. (Bank balance increased)
To Cash A/C (Cash balance decreased)This type of transaction affects both cash and
bank and these are called contra transactions
2) When cheque is received two entries arepassed
Cash A/C Dr. (When cheque is received)To Debtors
Bank A/C Dr. (When cheque is deposited)
To Cash
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ILLUTRATIONS Enter the following transactions in a Three-
column cash book. Cheques are first treated ascash receipts
2005 Rs.
Jan 1 Cash in hand 20000 Jan 2 Paid into Bank 19000
Jan 3 Receives cheques from Kirti and Co 600
Jan 4 Pays into bank Kirti and Cos Cheque 600 Jan 5 He pays Ratan and Co. by Cheque and is
allowed discount of Rs. 20 330
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THREE COLUMN CASH BOOKSolution:
date Particulars
discount
bank cash date Particulars
discount
bank cash
1-1-20052-1-20053-1-2005
4-1-2005
To bal b/d
To cash
To kirti &com
To cash
C
c
19000
600
20000
600
2-1-20054-1-20055-1-2005
31-1-2005
By bank
By bank
By Ratna& com.
By bal. c/d
c
c
20 330
19270
19000
600
1000
19600 20600 20 19600 20600
Three Column Cash BookDr. Cr.
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Exercise:
Enter the following transactions into athree-column cashbook.
2005 Rs.
Feb 1 Cash in hand 10,000 Feb 2 Receives cheques from Warsi 0f
4700 and Allows him discount Rs. 300
Feb 3 Pays by cheque for cashpurchases 2,000
Feb 4 Sundry exp. paid in cash 500
P h D B k
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Purchases Day Book:
Purchases book or purchases day
book is a book of original entry
maintained to record credit purchases.
You must note that cash purchaseswill not be entered in purchases day
book because entries in respect of
cash purchases must have been
entered in the cash book.
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Purchases Day Book:Invoice: When credit purchased of goods was
made a supplier sent a statement called invoice
indicating quantity, price, value ,trade & cash
discount and the condition under which payment is
expected.
Trade discount: is a discount offered by suppliersto the retailers to encourage bulk purchase.
Generally it is concession off the list price, hence
deducted from invoice & not necessary to maintain
further records.
Cash discount: is a discount offered to encourage
early payment of credit sales. Ledger account
should maintained discount allowed & received.
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Purchases Day Book:
-No Cash Purchase
-No Fixed Asset Purchase-No Cash Discount
Purchases Day Book: Format
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Purchases Day Book: Format
Date Particulars InvoiceNo
L.F Details Amt
.
.
....
A) Supplier name
@Rs..
@Rs..
Less:trade discount
B) Supplier name
@Rs..@Rs..
Less:trade discount
Total
Xxx
Xxx
Xxx
Xxx
XxxXxx
Xxx
xxx
Xxx
Xxx
xxx
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Purchase day bookPosting to Ledger
Date
Particulars J.F Amt Date Particulars J.F
Amt
To Cash A/c
To sundries
(credit purchase)
Xxx
xxx
xxx
Total purchase A/c Cr.Dr.
Suppliers (individual) A/cDr. Cr.
Dat
e
Particulars J.F Amt Date Particulars J.F Amt
By Purchase xxx
xxx
P h D B k Ill t ti
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Purchases Day Book: Illustrations
prepare the purchases day book of a M/s Universal
Book Stores and post it into ledger for July 2009:-
2009 July 5 Purchased books from Kalyan publisher:
12 Advance Accounting @ Rs 45
24 Double entry Book keeping @ Rs 30
(Trade discount 15%)2009 July 17 Purchased Furniture on credit of Rs
10,000 from furniture house ltd.
2009 July 22 Purchased books from Kitab mahal:
8 Statistics for bachelors @ Rs 2510 Economics Intermediate @ Rs 20
(Trade discount 10%)
2009 July 27 Purchased books on cash from swostik
prakasha:10 Management @ Rs 28
Purchases Day Book of M/s Universal book store for July 2009
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Purchases Day Book of M/s Universal book store for July 2009
Date
2009
Particulars Inv.no
L.F
Details
Amt
July 5
July22
A) Kalyan publisher
Adv.Accounting 12@Rs45
Double entry 24@Rs30
Less:trade discount @15%
B) Kitab mahal
statistics 8@Rs25Economics 10@Rs20
Less:trade discount @10%
Total
540
480
1020153
200200
400
40
867
360
1227
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Purchase day bookPosting to Ledger
Date Particulars J.F
Amt Date
Particulars J.F
Amt
27 july
31 july2009
To Cash
To sundries
(credit purchase)
2800
1227
Date
Particulars J.F
Amt Date Particulars J.F Amt
5 july2009
By Purchase 867
Total purchase A/c Cr.Dr.
M/s universal book store A/cDr. Cr.
Kitab Mahal A/c
Date
Particulars J.F
Amt Date Particulars J.F Amt
22 july
2009
By Purchase 360
Cr.Dr.
Purchases Returns Book:
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Purchases Returns Book:
Purchases returns bookis a book in whichthe goods returned to suppliers arerecorded. It is also called returns outwardbookor purchases returns day book.
Goods may be returned because they are of
the wrong kind or not up to sample orbecause they are damaged etc.Debit Note:
When the goods are returned to the
suppliers, an information is sent to themknown as a debit note. A debit note is astatement sent by a businessman to anotherperson, showing the amount debited to the
account of the later.
Purchases Return Book: Format
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Purchases Return Book: Format
Date Particulars Debitnote
L.F Details Amt
.
.
....
A) Supplier name
@Rs..
@Rs..
Less:trade discount
B) Supplier name
@Rs..@Rs..
Less:trade discount
Total
Xxx
Xxx
XxxXxx
XxxXxx
Xxx
xxx
Xxx
Xxx
xxx
P h t P ti t L d
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Purchase return Posting to Ledger
Date
Particulars J.F Amt Date Particulars J.F
Amt
By sundries xxx
xxx
Return outward A/c Cr.Dr.
Suppliers (individual) A/cDr. Cr.
Dat
e
Particulars J.F Amt Dat
e
Particulars J.F Amt
To Returnoutward
xxx
xxx
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Purchases Return Book:
Illustrations
Record the following transactions in the books of
Kailash traders.
2009 Jan 6 Returned to shyam & Co :12 Cup @ Rs 5
20 Plate @ Rs 4
(Trade discount 5%)
2009 Jan 27 Returned to Roshan:8 Cup @ Rs 5
10 Plate @ Rs 4
(Trade discount 10%)
P h R t B k f K il h T d f J
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Purchases Return Book of Kailash Traders for JanuaryDate Particulars Inv
.noL.F
Details
Amt
Jan 6
Jan27
A) Shyam & Co.
12 Cup@ Rs 5
10 Plate@ Rs 4
Less:trade discount @5%
B) Roshan
8 Cup@ Rs 520 Plate@ Rs 4
Less:trade discount @10%
Total
60
40
1005
4080
120
12
95
108
203
P h b k P i L d
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Purchase return bookPosting to Ledger
Date Particulars J.F Amt Date Particulars J.
F
Amt
Jan 31 By sundries 203
Date Particulars J.F Amt Date Particulars J.F Amt
Jan 6 To Returnoutward
95
Return Outward A/c Cr.Dr.
Shyam & Co A/cDr. Cr.
Roshan A/c
Date Particulars J.F Amt Date Particulars J.F Amt
Jan
27
To Return
outward
108
Cr.Dr.
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Sales Day Book:
A sales book is also known as sales daybook is a book of original entry in which allthe details of credit sales are recorded.
Total of sales book shows the total creditsales of goods during the period concerned.
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Sales Day Book:
-No Cash Sales
-No Fixed Asset Sales-No Cash Discount
Sales Day Book: Format
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Sales Day Book: Format
Date Particulars InvoiceNo
L.F Details Amt
.
.
....
A) Customer name
@Rs..
@Rs..
Less:trade discount
B) Customer name
@Rs..@Rs..
Less:trade discount
Total
Xxx
Xxx
XxxXxx
XxxXxx
Xxx
xxx
Xxx
Xxx
xxx
Sales day book Posting to Ledger
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Sales day bookPosting to Ledger
Dat
e
Particulars J.F Amt Date Particulars J.
F
Amt
By Cash A/c
By sundries
(credit purchase)
Xxx
xxx
xxx
Total Sales A/c Cr.Dr.
Customers (individual) A/cDr. Cr.
Dat
e
Particulars J.F Amt Dat
e
Particulars J.F Amt
To Sales xxx
xxx
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Sales Day Book: Illustrations
From the following transactions prepare sales book of Decoratefurniture house for May 2009 and post them to ledger:
May 5 Sold on Credit to Amrit Stationary:
10 Tables @ Rs 45
20 Chairs @ Rs 3012 Sold to IBM College:
15 chairs @ Rs 30
25 stools @ Rs 20
(Trade discount 10%)
17 Sold to Cash to Govinda Thapa
5 Tables @ Rs 45
25 Sold old typewriter to Madan Lal
on credit for Rs 1000
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Sales Day Book of Decorate Furniture for May 2009
Date2009
Particulars Inv.no
L.F
Details
Amt
May 5
May12
A) Amrit stationary
10 table@4520 chairs@Rs30
B) IBM college
15 chairs@3025 stools@Rs20
Less:trade discount @10%
Total
450600
450500
950
95
1050
855
1905
S l d b k P ti t L d
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Sales day bookPosting to Ledger
Date Particulars J.F Amt Date Particulars J.
F
Amt
May 17
May 31
By cash
By sundries
(credit purchase)
225
1905
Date Particulars J.F Amt Date Particulars J.F Amt
May5
To Sales 1050
Total Sales A/c Cr.Dr.
Amrit Stationary A/cDr. Cr.
IBM college A/c
Date Particulars J.F Amt Date Particulars J.F Amt
May
12
To Sales 855
Cr.Dr.
S l t b k
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Sales returns book
Sales returns book is also called returns
inwards book. It is used for recording goodsreturned to us by our customers.
Goods may be returned because they are
of the wrong kind or not up to sample orbecause they are damaged etc.
Credit Note:Customers who return goods should be senta credit note. It is a statement sent by abusiness to another person showing the
amount credited to the account of the later.
Sales Return Book: Format
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Sales Return Book: Format
Date Particulars Creditnote
L.F Details Amt
.
.
....
A) Customer name
@Rs..
@Rs..
Less:trade discount
B) Customer name
@Rs..@Rs..
Less:trade discount
Total
Xxx
Xxx
XxxXxx
XxxXxx
Xxx
xxx
Xxx
Xxx
xxx
Sales Return book Posting to Ledger
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Sales Return bookPosting to Ledger
Dat
e
Particulars J.F Amt Date Particulars J.
F
Amt
To sundries xxx
xxx
Return inwards A/c Cr.Dr.
Customers (individual) A/cDr. Cr.
Dat
e
Particulars J.F Amt Date Particulars J.F Amt
By Returninwards
xxx
xxx
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Sales Return Book: Illustrations
Record the following transactions in the books of
Ekta Sports Supplier.2009 Jan 12 Returned From Akash :
2 Cricket bat @ Rs 100
4 Football @ Rs 50
(Trade discount 5%)2009 Jan 25 Returned From Global college:
1 Volleyball@ Rs 40
2 Football @ Rs 50
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Sales Return Book of Ekta sports Suppliers for Jan
2009
Date2009
Particulars Inv.no
L.F
Details
Amt
jan12
Jan
25
A) Akash
2 Cricket bat@Rs 100
4 Football @ Rs 50
B) Global college
1 Volleyball@402 Football@Rs50
Less:trade discount @10%
Total
200
200
40100
140
14
400
126
526
Sales Return book Posting to Ledger
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Sales Return bookPosting to Ledger
Date Particulars J.
F
Amt Dat
e
Particulars J.
F
Amt
Jan 312009
To sundries 526
Date
Particulars J.F
Amt Date Particulars J.F Amt
Jan 122009
By Returninwards
400
Ekta Sports Suppliers A/c Cr.Dr.
Akash A/cDr. Cr.
Global College A/c
Date
Particulars J.F
Amt Date Particulars J.F Amt
Jan 25
2009
By Return inward 126
Cr.Dr.
Purchases Day Book: Exercise
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Purchases Day Book: Exercise
prepare the purchases day book of a Wears Fashion
Shop and post it into ledger for March 2009:-2009 March 5 Purchased from Kathmandu Mahal
20 Shirts@ Rs 850 (Trade discount 10%)
24 Pants @ Rs 1300
(Trade discount 15%)2009 March 17 Purchased Furniture on credit of Rs
10,000 from wood land ltd.
2009 March 22 Purchased from R.B Complex:
10 Jackets @ Rs 1500 (Trade discount 10%)
10 Trousers @ Rs 300
2009 March 27 Purchased on cash from Suraj Arcade
10 T-shirts @ Rs 280
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Purchases Return Book: Exercise
Record the following transactions in the books of
Mr Arun & Co.:2010 Jan 6 Returned to Maheshowr & Co:
4 Chair @ Rs 500
5 Table @ Rs 400 (Trade discount 5%)
2010 Jan 27 Returned to Roshan & Co:2 Table fan @ Rs 2250
1 Heater @ Rs 2500
(Trade discount 10%)
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Sales Day Book: Exercise
From the following transactions prepare sales book of InnovativeComputer suppliers for May 2009 and post them to ledger:
May 5 Sold on Credit to United College
5 Lenovo computer @ Rs 50,000
6 Ordinary computer@ Rs 30,00011 Sold to Cash to Mr. Bibek.
1 Laptop Compaq @ Rs 45
13 Sold to IBM College:
8 Laptop Compaq @ Rs 60,000 (Trade discount
10%)
10 Lenovo Computer @ Rs 50,000
25 Sold old Delivery Van to Mr Khan.
on credit for Rs 200,000
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Sales Return Book: Exercise
Record the following transactions in the books of
Wood land Furnishing House2009 Jan 12 Returned From Bishnu :2 Visitors Chair @ Rs 2500
1 Revolving Chair @ Rs 5000
(Trade discount 5%)2009 Jan 25 Returned From Caspian College:
5 Armed Chair @ Rs 1400
2 Officer Desk @ Rs 12500 (Trade discount 5%)