Purchases Day Book:
Learning Objectives:
-
Define and explain purchases day book.
-
What are the ruling and posting of the
purchases book?
-
Prepare a purchases day book.
Definition and Explanation:
Purchases book or purchases day book is
a book of original entry maintained to record credit purchases. You
must note that cash purchases will not be entered in purchases day book
because entries in respect of cash purchases must have been entered in the
cash book. At the end of each month, the purchases book is totaled. The
total shows the total amount of goods purchased on credit. Purchases book is
written up daily from the invoices received. The invoices are consecutively
numbered. The invoice of each number is noted in the purchases book.
Ruling:
It is not ruled like the ordinary journal. The
first column in this book is for date. In the second column, the name of the
supplier or the seller, quantity of each article bought, description of the
article, rate etc., are recorded. Sometimes a separate column to record the
details of the transactions is added in the purchases day book. The third
column is for invoice number. The fourth column is for ledger folio. The
last column gives the total amount to the supplier.
Posting:
The total of the purchases book is posted to
the debit of purchases account. Names of the suppliers appear in the
purchases book. These parties have supplied the goods. They are, therefore,
credited with the amount appearing against their respective names. The
double entry will thus be completed.
Format:
The following is the format of purchases day
book:
|
Date |
Particulars |
Inv.No. |
L.F. |
Amount |
| |
|
|
|
|
Example:
From the following transactions of a trader prepare the purchases day book
and post it into ledger:-
| 1991 |
|
$ |
| January 5 |
Purchased goods from
Rasool & Co. |
2,400 |
| "
15 |
Purchased goods from Iqbal
Bros. |
6,000 |
| "
25 |
Purchased goods from More
& Co. |
1,500 |
| "
30 |
Purchased goods from
Maqbool & Co. |
3,000 |
Solution:
Purchases Day Book
|
Date |
Particulars |
Inv.No. |
L.F. |
Amount |
|
1991
Jan. 5 |
Rasool & Co.
Iqbal Bros.
More & Co.
Maqbool & Co.
|
|
|
$
2,400
6,000
1,500
3,000 |
Purchases Account
|
1991
Jan. 31 |
To Sundries as per P/Book |
$
12,900 |
|
|
|
Rasool & Co.
| |
|
|
1991
Jan. 5
|
By Purchases |
$
2,400 |
Iqbal Bros.
| |
|
|
1991
Jan. 15
|
By Purchases |
$
6,000 |
More & Co.
| |
|
|
1991
Jan. 31
|
By Purchases |
$
1,500 |
Maqbool & Co.
| |
|
|
1991
Jan. 30
|
By Purchases |
$
3,000 |
You may also be interested in other relevant articles:
-
Definition and Explanation of Cash Book
-
Single
Column Cash Book
-
Two Column
Cash Book/Double Column Cash Book
-
Three
Column Cash Book
-
Bank Reconciliation Statement
-
Petty Cash Book
-
Purchases
Day Book
-
Purchases Returns Book
-
Sales Day
Book
-
Sales
Returns Book
-
Bills
Receivable Book
-
Bills Payable
Book
-
Journal Proper
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