Question

Mention the subsidiary book in which following transactions are recorded:

a) Purchased machinery on Cr.

b) Purchased goods on Cr.

c) Goods returned by Drs.

d) Sale of old furniture for cash

e) Bad debts

f) Sale of vehicle on credit

g) Sale of goods on credit​

Answer 1

Answer:

Answer Text

Solution :

(i) Journal Proper: Because purchase of fixed assets on credit is recorded in Journal Proper.

(ii) Sales Book: Because Sales Book records only credit sales of goods.

(iii) Sales Return Book: Because goods returned by customer are recorded in Sales Return Book.

(iv) Purchases Book: Because Purchases Book records only Credit Purchases of goods.

(v) Journal Proper: Because Journal Proper records all those transactions which cannot be recorded in any of the other subsidiary books . Interest on proprietor's capital is also one of those items which can only be recorded in Journal Proper.

(vi) Purchases Return Book: Because it records only goods returned by the firm to its suppliers.

(vii) Cash Book: Because it records cash receipts and cash payments.