Subsidiary Books, Meaning and Types

Accounting can be a tiresome process. A company has thousands of financial transactions in a year and journalizing them all can get quite bothersome. So some companies choose to prepare subsidiary books, in which we record transactions of a similar nature in chronological order. Let us learn about them.

Subsidiary Books

Subsidiary books are books of original entry. In the normal course of business, a majority of transactions are either relate to sales, purchases, or cash. So we record transactions of the same or similar nature in one place, i.e. the subsidiary book. And we record these transactions in chronological order

Types of Subsidiary Books

The following are the subsidiary books a company will generally maintain while writing their accounts,

Cash Book- It is a book which records the receipts and payment of cash transaction.

Purchase Book- It is a book which records all the credit purchases of goods of the company.

Purchase Return Book- It is a book which records all the return of credit purchases of goods of the company.

Sales Book- It is a book which records all the credit sales of goods of the company.

Sales Return Book- It is a book which records all the return of credit sales of goods of the company.

Bills Receivable Book- It is a book which records all the bills receivable.

Bills Payable Book- It is a book which records all the bills payable.

Journal Proper- All the transactions which are not recorded in the above books are recorded here.

So, here we have learnt brief detail about Subsidiary books and its types in next post we will see it in Detail.