THE PURCHASES JOURNAL

The purchases Journal or Day book is a book of prime resale are recorded. In a list of transaction credit purchases are distinguished from cash purchases by having the names of the sellers indicated or by being clearly stated as such.

In purchases jointed, trade discounts are dedicated from the gross amount to arrive at the net amount payable. It is also important know that trade discounts are treated finish and last in the purchases or sales journals (Note: they have no separate ledger accounts), while cash discounts as was previously discussed are recorded finish in the cash book and posted to either cash

discount allowed account or discount received account in the ledger.

The purchases ledger has column for date of purchases, and the total amount of purchases invoice number, name of the seller, ledger folio, details of the amount of purchases information recorded in the purchase journal extracted from the purchases invoice.

ILLUSTRATION

Record the following transaction in the purchases journal of Mr. Nkwo in the year 1998 and post them to the ledger.

Time 2: purchased from Odom & Co

55 cartons of swan soap @ N910

per carton

92 cartons of Line soap @ 600 p/carton

41 cartons of Omo @ 650 per carton

nkwo was granted 9½% trade discount.

Time 12: Bought from UAC to D

30 packet Shirts @ 450 each

16 sets of under wears @ 200 per set

23 singlets @ 150 each

he received 5% trade discount

June 28: Bought from Obasi Chibueze & sons

80 dozens of Napkins @ 650 a dozen

22 dozen hand towels @ 560 a dozen

20 dozen face towels @ 260 a dozen

 solution:

Mr.Nkwo’s books

PURCHASES JOURNAL

date	Invoice No.	particulars	folio	details	amount
June 2	0060	Odom & CO	6	N	N
		55 Cartons Of Swan Soap @ N 910 Each		50,050
		92 Cartons Lux soap @ N 600		55,200
		41 cartons of Omo @ 41 cartons of Omo @ N 650 each 650 each		26,650
		Less: 95% trade discounts (o0.0095x131, 900		131,900
June 12	0063	UAC LED:	8	12,530.50	119,36050
		30 packet shirts @ N 450 each		13,500
		16 sets of under wears @ N 300 each		4,800
		23 singlets @ N 150 each		3450
		Less: 5% trade discount		21,750
June 28		Obasi Chibueze & Sons:		1087.5020,662.50
		80 dozen Napkins @ N 650 each	14	52,000
		22 dozen hand towels @ 560 each		12,320
		20 dozen face towels @ 360		7,200	71,520
June		Total to purchases APC		16	211,552

LEDGER 3

Dr Odom & co Account.

                                       June2. purchases   119,369,.50

DR UAC LED Account or

                              June 28 purchases 71, 520

DR  purchases account or

                                 JUNE 2 sundries 211, 552

TRIAL BALANCES

Particulars	folio	dr	dr
Odom & co Lted		6	119,369,50
UAC lted		8	20,662.50
Obasi chibueze & sons			71,520.00
Purchases account

Note: invoice & folio numbers were assumed.

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