Books of Prime Entry

Question 1

What is the Book of Prime entry

Answer 1

A book, or journal, in which transactions are first recorderd before being posted to the double entry accounts

Question 2

Cash book

Answer 2

All cash and bank transactions. A combined cash and bank account which records all transactions involving payments and receipts of money.

Question 3

Petty cash book

Answer 3

All small items of cash payments

Question 4

Sales journal

Answer 4

All credit sales of goods

Question 5

Purchase journal

Answer 5

All credit purchases of goods bought for resale

Question 6

Sales return journal

Answer 6

Sales returns of goods previously sold

Question 7

Purchase return journal

Answer 7

Purchase returns of goods previously purchased

Question 8

General journal

Answer 8

Any transaction not covered by the other journals

Question 9

Differences between Discount allowed and Discount recieved

Answer 9

A discount allowed is A reduction in the invoice given by the business, us, to credit customers to encourage early settlement of invoices. A discount received is a receive from another business to our business to encourage for early settlement.