🔍 Definition:

Subsidiary books (also known as special journals or subsidiary journals) are books of original entry where similar types of transactions are recorded systematically and chronologically, before posting to the ledger. They help reduce the workload on the general journal and make record-keeping more efficient.

Introduction

In the world of accounting, accurate and systematic record-keeping is crucial. One way businesses manage high volumes of transactions efficiently is through subsidiary books. This blog explains what subsidiary books are, why they matter, the types you need to know, and key things to remember when solving accounting sums related to them.

🧩 What is a Subsidiary Book?

A subsidiary book is a type of accounting book where specific kinds of transactions are recorded initially, before being transferred to the ledger. These books help streamline bookkeeping by categorizing and grouping similar transactions.

📚 Types of Subsidiary Books

There are eight main subsidiary books commonly used in accounting:

1. Cash Book – Records all cash and bank transactions.

2. Purchases Book – Records all credit purchases of goods.

3. Sales Book – Records all credit sales of goods.

4. Purchases Return Book – For returns to suppliers.

5. Sales Return Book – For returns from customers.

6. Bills Receivable Book – For bills accepted by debtors.

7. Bills Payable Book – For bills accepted by the business.

8. Journal Proper – Records miscellaneous or adjusting entries.

✅ Importance of Subsidiary Books

• Simplifies recording and reduces clerical work.

• Helps assign responsibilities to specific personnel.

• Facilitates easy error tracing.

• Improves accuracy and speed of posting to the ledger.

📝 Things to Take Care of While Solving Subsidiary Book Problems

When solving questions or journal entries related to subsidiary books:

1. Identify the Type of Transaction:

   • Is it a cash sale? Use the Cash Book.

   • Is it a credit purchase of goods? Use the Purchases Book.

   • Is it a return of goods? Use Return Books accordingly.

2. Check Whether It’s a Cash or Credit Transaction:

   • Credit transactions go into subsidiary books.

   • Cash transactions go into the Cash Book.

3. Use Correct Format:

   • Use columns such as Date, Particulars, Invoice Number, Ledger Folio, and Amount.

   • Formats vary slightly by book type (e.g., Sales Book has “Customer Name,” “Invoice No.”).

4. Exclude Non-Qualifying Transactions:

   • Purchase of assets (furniture, machinery) on credit does not go into the Purchases Book.

   • Only goods meant for resale are included.

5. Record Chronologically:

   • Always maintain chronological order to ensure accuracy and compliance.

6. Cross-Check Calculations:

   • Totals in each subsidiary book should be checked before transferring to the ledger.

✅ Example Entry (Purchases Book):

🏁 Conclusion

Subsidiary books are the backbone of accurate accounting. By categorizing and recording specific transactions separately, businesses can maintain clean financial records and improve decision-making. Whether you’re preparing for an exam or managing books professionally, understanding and practicing these concepts is key.