Books of Prime Entry

Question 1

what is a sales day book used for?

Answer 1

used to list the credit sales taht the business has issued invoices for during a period

Question 2

what happens at the end of a period to the sales day book?

Answer 2

the book is then transferred to the sales account

Question 3

what happens when goods are sold on credit

Answer 3

invoice is issued to customer

Question 4

what is the sales day book?

Answer 4

book of prime entry

Question 5

what is the sales return day book?

Answer 5

this book is used to list the credit sale returns that the business has issued credit notes for

Question 6

what is the process of the sales day book?

Answer 6

goods sold on credit, entered in sales day book, debit the receivebles acc and credit the sales acc

Question 7

what happens at the end of the period to the sales return day book?

Answer 7

the total is transferred to the sales returns acc

Question 8

what is the process of the sales returns day book?

Answer 8

goods returned by the cust, entered in the sales returns day book, debit the sales returns acc & credit the recievables acc

Question 9

what is the purchases day book used for?

Answer 9

this is used to list all the credit purchases that the business has recieved invoices for.

Question 10

what is the process of the purchases day book?

Answer 10

goods purchased on credit, enter in the purchases day book, debit the purchases acc

Question 11

what is the purchase returns day book used for?

Answer 11

to list all the credit purchase returns that the business has recieved credit notes for

Question 12

what are the purchase returns day book trasnferred to at the end of the period?

Answer 12

tramsferred to purchases returns acc

Question 13

what is the process of the purchases returns day book?

Answer 13

good returned to the supplier, entered in the purchases returns day book, debit and credit the purchases returns acc

Question 14

what is the analysed day books used for?

Answer 14

it might be useful for the business to ananlyse thier sales or expenses within the daybook, eg if they had 3 different types of sales

Question 15

what does the discounts allow and recieved day book reecord?

Answer 15

promopt payment discounts and does not record trade or bulk discounts

Question 16

why does the discounts book not record trade if bulk discount?

Answer 16

this is accounted for within the original invoice

Question 17

what do the daybooks record?

Answer 17

the credit notes that are either issued to customer’s or received by suppliers once discount has been taken

Question 18

what is the petty cash book?

Answer 18

where small paymwnts and recipt in cash are recorded. - usually has a petty cash tin

Question 19

what i the cash book used to record?

Answer 19

this records reciept and oayments that go via the business bank acc and makes up part of the double entry system

Question 20

for small businesses, which book is commonly used on its own?

Answer 20

the csh book is the only book of prime entry

Question 21

why might a business split the cash book?

Answer 21

to show a cash recipt book and a cash payment book

Question 22

what does the general ledger include?

Answer 22

cash sales and purchases

Question 23

why does the GL include cash sales and purchases?

Answer 23

as they do not get posted to the recievables and payables ledger accs, as they are not credit items