Purchases Journal

Purchases Journal or Purchases Day Book – Definition and Explanation:

Purchases of goods may be on cash or on credit basis. Purchases journal sometimes called purchases day book, only records credit purchases whereas cash book is used to record cash purchases.

Preparation Procedure of Purchases Journal and its Format:

The purchases journal is prepared from original invoices received from suppliers. The form purchase invoice may vary from business to business but they all show the same basic information and include name of the supplier on the top with name of the customer (business), the rates, quantities and total amounts of goods purchased. Like sales journal, purchases journal contains transactions net of trade discounts (i.e., after deduction of any trade discount but before any cash discount). Following are steps, which consider in purchases journal:

(i) Credit purchases

(ii) Purchases invoice

(iii) Recording in purchases journal, as:

(a) Individual amounts posted to credit side of suppliers’ accounts in purchases ledger.

(b) Total amount posted to debit side of purchases account in general ledger.

The following format for purchases journal or purchases day book is used by the business:

purchases journal format

Note: References to the relevant ledger account (often called folio).

Procedure of Posting Entries from Purchases Journal to Purchase Ledgers:

Business usually have a separate purchases ledger containing all the trade payables (suppliers) account.

Credit purchases recorded in the purchases journal are posted to the credit side of each supplier’s account in the purchases ledger on individual basis. In addition, the total credit purchases at the end of each period is posted to the debit side of the purchases account in the general ledger. Purchases journal can be explained with the help of following example:

Solved Example:

The following is a purchases journal of a business for January 2019:

Purchases Journal (Purchases Day Book):

purchases journal


Explain the above purchases journal and posting its items to purchases ledger and general ledger:


The double entry is completed by crediting the appropriate accounts of suppliers in the purchases ledger and debiting the total amount to purchases account in the general ledger. This is shown in the following accounts:

Purchases Ledger:

purchases ledger

General Ledger (Purchase Account):

purchases account