10. Books of Prime Entry Flashcards
What are the books of prime entry?
Books in which each transaction is listed as it occurs (no double entry).
What are the five main books of Prime Entry?
- Cash Book
- Purchase Day Book (Purchases Journal)
- Sales Day Book (Sales Journal)
- Journal
What is recorded in the Cash Book?
A list of all receipts and payments through the bank.
Usually split into a book for receipts and another for payments.
What is recorded in the Purchases Day Book?
Lists all purchases on credit.
What is recorded in the Sales Day Book?
A list of all sales on credit.
What is recorded in the petty cash book?
All receipts and payments of loose cash.
What is recorded in The Journal?
Less common transactions that are not covered by the other books of prime entry.
What is the alternate name for the Receivables Ledger?
The Sales Ledger.
What is the alternate name for the Payables Ledger?
The Purchases Ledger.
What is the Receivables Ledger?
A record of how much each customer owes to the company.
There is an account for each customer.
Entries are made every time there is a sale or cash received.
What is the Payables Ledger?
A record of how much is owed to each supplier.
There is an account for each supplier.
Entries are made every time there is a purchase.
What is important to remember about the Payables and Receivables Ledgers?
They are not part of double entry bookkeeping.
They are a memorandum.
What is another name for note?
Memorandum.
What is unique about the Petty Cash book compared to the other Books of Prime Entry?
It is part of double entry bookkeeping.
What is a common system used to control the amount of petty cash and help prevent employee theft?
The imprest system.
