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Books of Prime Entry | O Level Accounting 7707 & IGCSE Accounting 0452 | Detailed Free Notes To Score An A Star (A*)

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  • Also called the books of original entry
    • The place where entries are entered for the first time.
    • First instance recording
    • They are part of single entry system, have to be converted to dual entry system
  • A transaction goes to source documents that is a proof which makes it entered in books of prime entry, then we convert them to T accounts for dual entry system and then make a trial balance
  • Cash book
    • Only cash transactions and bank transactions
    • Discount allowed and received (cash discounts) also mentioned here
    • Cheque counterfoil for payments
    • Cheque copy for payments received
    • Receipt for cash payments made
    • Receipt for cash received
    • Part of the double entry system, in the form of a T account as well
    • Combines the T account of cash and bank
    • Has three forms
      • Single column for bank transactions
      • Double column for bank and cash transactions
      • Three columns and cash, cash discounts and bank
    • We can deposit and withdraw cash as well
      • It will be a contra entry
      • Both sides
      • For example, owner deposits 100 in bank and then withdraws it
    • Only regarding business current account
    • No fixed deposit accounts
    • Bank overdraft is the credit balance on bank account
  • Purchase Journal
    • Credit purchases only
    • Purchase Invoice
  • Purchase Returns Journal
    • Purchase Returns on credit purchases
    • Debit Note
  • Sales Journal
    • Only credit sales
    • From sales invoice
  • Sales Returns Journal
    • Only returns on credit sales
    • Credit Note
  • General Journal
    • All other transactions
    • All other documents
    • Expenses
    • Income etc. are recorded here
  • Trade discount
    • The discount we get when buying a product,
    • 100 ki chez 90 main de do wala scene
    • We will not record this discount separately anywhere, we will just record the discounted price
  • Cash discount
    • It is on prompt payment or receipt of payments
      • If debtors pays faster than the actual date of payment, we give them a discount on this amount called Discount allowed
        • It is an expense
      • If we pay the creditor faster than the due date, he will offer us a cash discount on this loan, which is called discount received
        • It is an income
  • We give terms like 2/10,n/30
    • 2 percent discount of payment within 10 days
    • Net or actual amount to be paid in a maximum of 30 days
Hunain Zia

Hunain Zia has previously achieved considerable success in the high-school educational stream, gaining a massive 154 Total A Grades and 7 Major Distinctions, a process in which he broke/ set 11 different world records, including the most A grades ever achieved, most subjects ever appeared in, most distinctions, gaining distinctions across two separate boards (Pearson Edexcel and CAIE) within the same year/ ever, and even 19 hours of constant examination. All records stand intact today. Hunain pursued his Honors Accounting Degree from the prestigious Bentley University, and then completed an LLB (in Honors) from University of London. Currently, he manages multiple social and commercial projects, has founded digital streams and works tirelessly in the education sector.

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