O'Reilly logo

Financial Accounting by P. C. Tulsian

Stay ahead with the world's most comprehensive technology and business learning platform.

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, tutorials, and more.

Start Free Trial

No credit card required

CHAPTER 8

Subsidiary Books II—Other Books

PURCHASES BOOK

Purpose of Purchases Book

Purchases book (also known as Invoice book/Bought book) is used for the purposes of recording of merchandise (i.e., the goods in which the enterprise deals in) on credit. It records neither the cash purchases of the merchandise nor the purchase of any asset other than the merchandise.

Source Document of Recording

The entries in the purchases book are made on the basis of invoices received from the suppliers with the amounts net of trade discount/quantity discount. Trade discount is a reduction granted by a supplier from the list price of goods or services on business considerations (such as quantity bought, trade practice etc.) other than for prompt payment.

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, interactive tutorials, and more.

Start Free Trial

No credit card required