06 August 2010
Previously all the transactions were entered into Journal in the form of journal entries.
This was suitable till the business volume was in limited.
When business grew; it was felt that it is not suitable to write again and again -
Purchases A/c Dr.
To Party A/c
So it was thought; better put all these entries into one Book : Purchase Book and it would be deemed that Purchases is always Debited and Parties' Account is credited and accordingly Ledger Entries would be made.
Similarly; the Sales Book, Sales Return Book, Purchase Return Book, Bills Receivable Book, Bills Payable Bill and rest entries were made into Journal (popularly known as Journal Proper).
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