What is subsidiary book?


We record transactions by identifying them as financial and non-financial. All financial transactions are first recorded in a Journal. A small business will have a lesser number of transactions and therefore it is possible to record all business transactions in one book. However, in contrast with large business organizations, the number of a business transaction are also large. It is a very time-consuming, difficult, and tedious task for a firm to record such voluminous transactions and events in one single book. Thus, in order to save time and effort, we sub-divide the Journal to record the transactions of similar nature in a separate book. These sub-divided Journals are popularly known as Subsidiary Books. Sub-division of Journal provides division of work which leads to the improvement in efficiency and effectiveness.
Subsidiary books are Purchases Book, Sales Book, Cash Book, etc.

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