What is subsidiary book and its types?

Asked By: Ina Juergen | Last Updated: 2nd June, 2020
Category: business and finance debt factoring and invoice discounting
4.8/5 (364 Views . 12 Votes)
Types of Subsidiary Books
Purchase Book- It is a book which records all the credit purchases of goods of the company. Purchase Return Book- It is a book which records all the return of credit purchases of goods of the company. Sales Book- It is a book which records all the credit sales of goods of the company.

Click to see full answer


Similarly one may ask, what are the types of subsidiary books?

We can divide the subsidiary books into the following types:

  • Cash book.
  • Purchases book.
  • Sales book.
  • Purchases return or return outwards book.
  • Sales return or return inwards book.
  • Bills receivable book.
  • Bills payable book.
  • Journal proper.

Secondly, how many subsidiary books are there? Top 7 Types of Subsidiary Books – Discussed! Article shared by : ADVERTISEMENTS: Here we detail about the seven types of subsidiary books, i.e, (i) Purchases Book, (ii) Sales Book, (iii) Purchases Return Book, (iv) Sales Return Book, (v) Bills Receivable Book, (vi) Bills Payable Book and (vii) Journal Proper.

In respect to this, what are subsidiary books?

Subsidiary Books are those books of original entry in which transactions of similar nature are recorded at one place and in chronological order. In a big concern, recording of all transactions in one Journal and posting them into various ledger accounts will be very difficult and involve a lot of clerical work.

Why are subsidiary books important?

Importance or Objectives or Advantages of Subsidiary Books. Saving of Time and Labor: If all the transactions of similar nature are recorded together in a separate book, a considerable amount of labor and time can be saved. There is no need of preparing journal for each transaction with its narration.

39 Related Question Answers Found

What is the cash book?

A cash book is a financial journal that contains all cash receipts and disbursements, including bank deposits and withdrawals. Entries in the cash book are then posted into the general ledger.

What is contra entry?

Contra entry is a transaction which involves both cash and bank. Both debit aspect and credit aspect of a transaction get reflected in the cash book. For example: Cash received from debtors and deposited into bank. Cash withdrawn from bank for office use.

What are the uses of subsidiary books?

Purpose of Subsidiary Books
  • Purchases Book records only credit purchases of goods by the trader.
  • Cash Book Used to record all the cash receipts and payments.
  • Sales Book is meant for entering only credit sales of goods by the trader.
  • Purchases Return Book records the goods returned by the trader to suppliers.

What is petty cash book?

Petty cash is a system that funds and tracks small purchases such as parking meter fees that aren't suitable for check or credit card payments. A petty cash book is a ledger kept with the petty cash fund to record amounts that are added to or subtracted from its balance.

What are the features of subsidiary books?


Key Features of Subsidiary Books
There is a difference between a purchase book and a purchase ledger. A purchase book records only credit purchases and a purchase ledger records all the cash purchases in chronical order. The daily balance of purchase book is transferred to purchase ledger.

Is petty cash book a subsidiary book?

A subsidiary book in which all cash and bank transactions are recorded. A subsidiary book used for recording small cash payments with information taken from petty cash vouchers. The petty casher often has a float (called an imprest) to use for these payments.

What are the six books of original entry?

Books of original entry
  • Cash journal.
  • General journal.
  • Purchase journal.
  • Sales journal.

What is the format of cash book?

Cash book has two sides i.e., left-hand side and the right-hand side where all the receipts in cash are recorded on the left side whereas all the payments in cash are recorded on right side.

What is another name for subsidiary book?

Subsidiary Books of Account. Also known as special purpose books, special purpose subsidiary books, and subsidiary books of accounts are various books recording financial transactions of a similar nature. They are sub-division of the journal.

What are subsidiary accounts?


A subsidiary account is an account that is kept within a subsidiary ledger, which in turn summarizes into a control account in the general ledger. A subsidiary account is used to track information at a very detailed level for certain types of transactions, such as accounts receivable and accounts payable.

Is Cash book a subsidiary book or principal book?

Cash Book is both a Subsidiary book and a Principal Book. Subsidiary Book- As all cash transactions are recorded directly in the Cash Book, so there is no need to record them separately in Journal.

What are the types of books of accounts?

Books of Accounts for Businesses Engaged in Sales of Goods or Properties
  • General journal.
  • General ledger.
  • Cash receipt journal.
  • Cash disbursement journal.
  • Sales journal.
  • Purchase journal.

Is trial balance a statement?

Well trial balance is a statement because it is not prepared for a period of time and is prepared just on the date of closing of the accounts. Hence it is just a statement showing the balances of the assets and liabilities, expenses and incomes of the business on the date of closing of accounts!

What are the golden rules of accounting?

The following are the rules of debit and credit which guide the system of accounts, they are known as the Golden Rules of accountancy: First: Debit what comes in, Credit what goes out. Second: Debit all expenses and losses, Credit all incomes and gains. Third: Debit the receiver, Credit the giver.

What is three column cash book?


The three column cash book (also known as triple column cash book) has three money columns on both debit and credit side – one on each side for recording discount, cash and bank amounts.

What is the purpose of a subsidiary journal?

A subsidiary ledger contains the details to support a general ledger control account. For instance, the subsidiary ledger for accounts receivable contains the information for each of the company's credit sales to customers, each customer's remittance, return of merchandise, discounts, and so on.

Is Ledger a subsidiary book?

Subsidiary books are books of original entry. Think of your subsidiary book as sub-journals that record only one type of transaction. There is no separate entry for these transactions in the general ledger. The posting to the Ledger Accounts is done from the subsidiary book itself.