(a) What is a source document? (b) List six types of source documents. (c) state three uses of subsidiary books
Question 1 Report
(a) What is a source document?
(b) List six types of source documents.
(c) state three uses of subsidiary books
Answer Details
(a) What is a source document?
A source document is the original written record or evidence of a business transaction, from which entries are first made in the books of account. It provides proof that a transaction took place and shows its date, parties and amount.
(b) Six types of source documents
- Invoice
- Receipt
- Credit note
- Debit note
- Cheque (and its counterfoil)
- Cash memo / payment voucher
(Others acceptable: bank paying-in slip, purchase order, statement of account.)
(c) Three uses of subsidiary books
- They relieve the ledger of excessive detail by recording similar transactions together, keeping the ledger neat.
- They group transactions of the same type (e.g. all credit sales, all credit purchases), making reference and posting to the ledger easier and faster.
- They allow the division of book-keeping work among several clerks, which speeds up work and helps reduce and locate errors.
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