Explain in basic of subsidiary books in details | #subsidiary-book | cash book , petty cash book , sales book , purchase book , journal book |

 

SUBSIDIARY-BOOKS

Subsidiary books are special books maintained by a business to record specific types of transactions. These books are used to record transactions that occur frequently and are similar in nature. They are also known as sub-ledgers or auxiliary books.

There are several types of subsidiary books used by businesses, each designed to record a different type of transaction. Here are some of the most common types of subsidiary books:

1. Sales Book : This book is used to record all credit sales made by the business. Each entry in the sales book includes the date of the sale, the name of the customer, the amount of the sale, and any other relevant information.

2. Purchase Book : This book is used to record all credit purchases made by the business. Each entry in the purchase book includes the date of the purchase, the name of the supplier, the amount of the purchase, and any other relevant information.

3. Cash Book : This book is used to record all cash transactions made by the business. It includes both cash receipts and cash payments. Each entry in the cash book includes the date of the transaction, the amount of the transaction, and any other relevant information.

4. Petty Cash Book : This book is used to record all small cash transactions made by the business. It is maintained by the person responsible for handling petty cash and includes details of all payments made from the petty cash fund.

5. Journal : This book is used to record transactions that do not fit into any of the other subsidiary books. This includes items such as adjustments, corrections, and other one-time transactions.

Subsidiary books are useful for businesses as they help to organize transactions and make it easier to maintain accurate records. They also help to speed up the accounting process, as transactions can be entered into the appropriate book quickly and easily. Finally, they provide a detailed record of transactions, making it easier for businesses to track their financial performance and make informed decisions.