By: Ms. Roberts

 Books of original entry are called journals. They are very important in the accounting process.  Other acceptable names for these books include: ◦ Subsidiary books ◦ Prime books ◦ Day books ◦ Original journals ◦ Books of prime entry

 Sales day book or sales journal  Purchases day book or purchases journal  Returns inwards day book or returns inwards journal  Returns outwards day book or returns outwards journal  Cash book  Petty cash book  General journal

 Purchase orders  Receipts  Invoices  Credit notes  Petty cash vouchers  Vouchers  Debit notes

 Goods and services are sold in either of two ways: by cash or by credit.  The cash book is used to record cash sales. However, all sales to customers on credit are first recorded in the sales day book. Each time goods are sold on credit a document called a sales invoice is raised by the seller to be sent to the buyer.

Sales Journal DateExplanationInvoice No.Folio No.Amount $

The sales returns journal is used to record the goods returned by a customer to its suppliers. The source document used to record the information in the returns inwards journal is called a credit note.

 A credit note is used as a document for returns. There are times when goods might not be physically returned to the supplier, but some other measures have to be taken to reduce the original cost because of some problems seen. There are several reasons for issuing credit notes: ◦ Wrong goods have been supplied. ◦ The goods have been lost in transit. ◦ The goods have been damaged, but were not returned to the seller etc.

 A credit note is usually prepared by the supplier an sent to the customer. It is usually printed in red.

Credit Note Epicurean Supermarket Friars Hill Road St. John’s, Antigua Telephone: (268) Fax: (268) Bargain Centre Supermarket Perry Bay Credit Note No. 0/37 St. John’s Account No. P/4298 Antigua Date: 14 th February, 2014 Quantity 21 cases Cape Glory Pears Less 20 % Trade discount Per unit $ 25 Total $

Sales Returns Journal DateExplanationNote No. FolioAmount $ February Bargain Centre Supermarket0/37SL Total Returns transferred to the Returns Inwards Account GL 10420

When goods are bought for cash, no entry is made in the purchases book or journal. The transaction is recorded in the cash book. It is common practice in businesses to purchase goods (items bought for resale) and pay for them at a later date. In accounting for these goods, and entry must first be made in the purchases day book. The information recorded in the journal comes from the purchases invoice.

Purchases Journal DateExplanationInvoice No.FolioAmount $

 A debit note is a document made out exactly like an invoice. It is made out by the seller whenever the buyer has been undercharged on the invoice that was already sent. Sometimes other charges such as insurance and freight were omitted from the invoice sent. A debit note is written up and sent to the buyer whose debt would be increased.

DEBIT NOTE CHASE SUPERMARKET FACTORY ROAD ST. JOHN’S Telephone: (268) Fax: (268) Christo’s Supermarket Old Parham Road Debit Note No. 9/34 St. John’s Account No. H/3752 Date: 15 th February, 2014 Quantity 4 cases Canadian salmon Less 25 % Trade discount Per unit $ 60 Total $

Purchases Returns Journal DateExplanationNote No. FolioAmount $ February Christo’s Supermarket9/34PL Total purchases returns transferred to the Returns Outwards Account GL 2180

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