ZANZIBAR COLLEGE OF BUSINESS

EDUCATION
BASIC BOOK-KEEPING

SUBSIDIARY BOOKS

This book is kept to record all credit purchases of goods for resale. To be
eligible for being recorded in the purchase book ,the goods purchased on credit
must be those in which the firm normally deals. Cash purchases of goods are
entered in the CASH BOOK, so these are not recorded in PURCHASES BOOK.
This book is also known as Invoice book. The ruling of the purchases book is as
follows :
Date

Particulars

L.F

Amt
Dr

Amt
Cr

In many businesses, a considerable proportion of sales will be made on credit

rather than immediate cash. In fact the sales of some businesses will consist
entirely of credit sales. For each credit sale, the selling firm will send a
document to the buyer showing full details of the goods sold and the price of
the goods. This document is known as an invoice and to the seller it is known as
sales invoice. The specimen ruling of sales book is given below :

Date

Particulars

L.F

Amt
Dr

Amt
Cr

This book keeps the records of the returns outward, that is, return
of goods bought. The person returning the goods sends a debit note
to the supplier informing him that he is debiting the latters account
with the amount of goods returned. This book is also known as returns
outwards books. The specimen is given below :
Date

Particulars

L.F

Amt
Dr

Amt
Cr

Sales return book, also known as return inward book, is kept for recording
returns inwards, that is, returns of goods sold by us. The trader sends a
credit note to the customer informing him that he has credited the latters
account with the value of goods returned. The specimen is as follows :

Date

Particulars

L.F

Amt
Dr

Amt
Cr

Debit Note & Credit Note

A debit note is prepared when goods are

returned by the purchaser due to some
reason. Two copies of this note are prepared.
The original copy is sent to the party to whom
goods are return and the duplicate is kept in
the office.
A credit note is like a debit note. It is sent by
the seller to the purchaser for the goods
returned by the latter to the former.

Journal Proper

Journal proper is used for recording only

those transaction which can not be recorded
in any of the other subsidiary books examples
of such transaction are
Opening entries
Transfer Entries
Adjusting Entries
Closing Entries
Bad debts

Practical Problems

From the following transaction

prepare the sales return books of rajeshwari trading
company:
2002

Question..

Jan-1 Prabhaker and co. returned 50 bags of rice,

the rate of which is rupees 550 per bag
Jan-2 Raja and co. return 40 bags of sugar the rate
of which is rupees 750 per bag
Jan-10 Subhash and sons returned 10 tons of ground
oil, the rate of which is rupees 600 per ton
Jan-20 Ugandhar returned goods worth rupees 400

Date

Credit
note No.

Particulars

L.F

Amt.

2002
Jan-1

Prabhaker and co :
50 bags of rice @ Rs. 550 per bag.

27,500

Jan-2

Raja and co :
40 bags of sugar @ Rs. 750 per bag

30,000

Jan-10

Subhash and sons

10 tons of ground nut oil @ Rs. 660 per ton

6,000

Jan-20

Ugandhar
Sales return account

400
Dr.
63,900

Illustration 2
Enter the following transactions in proper Subsidiary Books and post the
same in the relevant ledger accounts.
2013 Tzs
Aug. 1 Bought goods from Ganga 25,000
Aug. 2 Sold goods to Kaveri 15,000
Aug. 5 Yamuna sold goods to us 15,000
Aug. 8 Krishna purchased goods from us 12,000
Aug. 11 Received goods returned by Kaveri 1,500
Aug. 13 Returned goods to Ganga 1000
Aug. 17 Sold goods to Ponni 8000
Aug. 22 Purchased goods from Sindhu 9000
Aug. 27 Returned goods to Yamuna 1500
Solution:

Purchases Book
Date

Aug. 1
Aug. 5
Aug. 22

Particulars

Ganga
Yamuna
Sindhu

L.F.

Inward
Invoice
Number

TZS
25,000
15,000
9000
4,900

Sales Book
Date

Particulars

2003
Aug. 2
Aug. 8
Aug. 17

Kavari
Krishna
Ponni

L.F.

Outward
Invoice
Number

TZS

15,000
12,000
8000
35,000

Purchases Returns Books

Date
2013
Aug. 13
Aug. 27

Name of
Supplier
Ganga
Yamuna

L.F.

Debit
Note

TZS

1,000
1,500
2,500

Sales Returns Book

Date
2003
Aug. 11

Name of
Customer
Kaveri

L.F.

Credit
Note

TZS

1500
1500