Question

Explain the need for drawing up the special purpose books.

Answer 1

The need for drawing up special purpose books is that it allow efficient and quick recording of the accounting transactions.

Explanation:

Special purpose books are the type of books that contains large number of business transactions which are difficult to keep in the records. It include sales and purchases book. These books are economical to maintain records and enable easy division of work.  

The needs for drawing up these books are as follows:

i. These books allow efficient and quick recording of the accounting transactions.

ii. These books are a convenient way to keep records as they have a repetitive nature.

iii. It is easy and economical to post the transactions as special purpose books save time.

iv. It keeps similar and complete information about the entries at one place. Information such as payments, receipts, sales, and purchases are easily available.