Subsidiary books are specialised journals that record specific types of repetitive transactions, reducing the burden on the general journal.
Key Subsidiary Books and their contents: - Purchases Book — Credit purchases of goods meant for resale. Each entry shows: date, supplier name, invoice number, details of goods, and amount. Does NOT include cash purchases or purchase of assets. - Sales Book — Credit sales of goods. Format mirrors the Purchases Book. Does NOT include cash sales. - Purchases Returns (Returns Outward) Book — Goods returned to suppliers with debit note details. - Sales Returns (Returns Inward) Book — Goods returned by customers with credit note details.
Source documents for subsidiary books: - Invoice/Bill → Purchases Book / Sales Book - Debit Note → Purchases Returns Book - Credit Note → Sales Returns Book
Posting from subsidiary books: - Individual entries are posted to personal accounts in the ledger - Monthly totals are posted to the relevant nominal account (Purchases A/c, Sales A/c, etc.)
Exam tip: Focus on which transactions go in which book. A common ICAI trick is including purchase of furniture on credit in a list — this goes in the Journal, not the Purchases Book, because furniture is an asset, not trading goods.