Purchases day book definition
/What is a Purchases Day Book?
A purchases day book is an accounting ledger in which purchasing transactions are recorded. This book is most commonly found in manual accounting systems, where purchases are recorded by hand in a ledger. The basic information recorded in a purchases day book includes the transaction date, name of the supplier, supplier invoice number, and supplier invoice amount.
At regular intervals, and always at the end of a reporting period, the transactions in the day book are summarized and carried forward (posted) to the general ledger. If anyone were to research a transaction, they would need to return to the day book in order to find the specifics of a transaction.
Advantages of a Purchases Day Book
The purchases day book is used to keep purchasing transactions from overwhelming the general ledger, which can be a major problem in a manual record keeping environment. A further benefit is that the purchases day book concentrates all purchasing transactions in one place, where they are easier to research.
Terms Similar to Purchases Day Book
A purchases day book is also known as a purchases journal.