Skip to content
prinsipperakaunan.com.my
Book a Trial Class

Form 4 · Chapter 4

Books of Prime Entry

Buku Catatan Pertama

Book a Trial Class

One-hour paid trial · Same-day reply · from RM50/hr

13 teaching hours

What this chapter covers

Form 4 Chapter 4, Books of Prime Entry, introduces the books used to record business transactions before any entry is made in the ledger. After learning about source documents in the previous chapter, you now see how information from invoices, credit notes, debit notes, cash vouchers and receipts is gathered and recorded in an orderly way by type of transaction. In the accounting cycle, source documents are the origin: transactions are recorded in a Book of Prime Entry, posted to the ledger, summarised in a trial balance, and finally used to prepare the income statement and the statement of financial position.

This chapter teaches you to organise thousands of transactions into neat groups so that posting to the ledger becomes fast, accurate and easy to check. Imagine a business like Kedai Runcit Aman making dozens of credit sales a day; if each one were posted straight to the ledger, the accounts would become cluttered and error-prone. By collecting transactions of the same kind in a special journal, only the total is posted to the control account at the end of the period. This skill underpins almost every chapter that follows, including the ledger, the trial balance and the preparation of financial statements.

There are seven Books of Prime Entry, in four groups, that you need to know under the content standards (Standard Kandungan): the General Journal for transactions that do not fit any other journal, four Special Journals for credit purchases, sales and returns, the Cash Book for all cash and bank receipts and payments, and the Petty Cash Book for small expenses run on the imprest system. Each has its own format, source document and purpose, all of which are explained one by one in this chapter.

Content Standards

4.1 Books of Prime Entry

Buku Catatan Pertama

Learning Standards (official DSKP wording, in Malay)

  • 4.1.1Menjelaskan maksud Buku Catatan Pertama
  • 4.1.2Menyenaraikan jenis-jenis Buku Catatan Pertama
  • 4.1.3Menerangkan kegunaan Buku Catatan Pertama

4.2 General Journal

Jurnal Am

Learning Standards (official DSKP wording, in Malay)

  • 4.2.1Menjelaskan tujuan penyediaan Jurnal Am
  • 4.2.2Melakar dan menerangkan format Jurnal Am termasuk lajur folio
  • 4.2.3Mengenal pasti urus niaga catatan pembukaan, belian dan jualan aset bukan semasa secara kredit, ambilan barang niaga, modal tambahan selain tunai dan bank serta catatan penutup
  • 4.2.4Merekod urus niaga secara manual atau menggunakan aplikasi TMK berdasarkan penyataan urus niaga dan dokumen sumber: (i) catatan pembukaan (ii) belian dan jualan aset bukan semasa secara kredit (iii) ambilan barang niaga dan aset bukan semasa (iv) modal tambahan selain tunai dan bank (v) catatan penutup (vi) catatan pelarasan (vii) pembetulan kesilapan (viii) realisasi

4.3 Special Journals

Jurnal Khas

Learning Standards (official DSKP wording, in Malay)

  • 4.3.1Menjelaskan tujuan penyediaan Jurnal Khas
  • 4.3.2Melakar dan menerangkan format Jurnal Khas termasuk lajur folio
  • 4.3.3Menjelaskan fungsi setiap jenis Jurnal Khas berikut: (i) Jurnal Belian (ii) Jurnal Pulangan Belian (iii) Jurnal Jualan (iv) Jurnal Pulangan Jualan (v) Jurnal Penerimaan Tunai (vi) Jurnal Pembayaran Tunai
  • 4.3.4Merekod urus niaga berdasarkan maklumat pernyataan urus niaga dan dokumen sumber ke Jurnal Khas secara manual atau menggunakan aplikasi TMK
  • 4.3.5Menutup Jurnal Khas

4.4 Cash Book

Buku Tunai

Learning Standards (official DSKP wording, in Malay)

  • 4.4.1Menjelaskan tujuan penyediaan Buku Tunai
  • 4.4.2Melakar dan menerangkan format Buku Tunai tiga lajur termasuk lajur folio
  • 4.4.3Merekod urus niaga berdasarkan pernyataan urus niaga dan dokumen sumber secara manual atau menggunakan aplikasi TMK
  • 4.4.4Mengimbangkan Buku Tunai dan menyatakan kedudukan baki Tunai dan baki Bank
  • 4.4.5Menjumlah lajur-lajur diskaun

4.5 Petty Cash Book

Buku Tunai Runcit

Learning Standards (official DSKP wording, in Malay)

  • 4.5.1Menerangkan tujuan penyediaan Buku Tunai Runcit
  • 4.5.2Menjelaskan sistem panjar
  • 4.5.3Melakar dan menerangkan format Buku Tunai Runcit termasuk lajur folio
  • 4.5.4Merekod perbelanjaan runcit berdasarkan pernyataan urus niaga secara manual atau menggunakan aplikasi TMK
  • 4.5.5Menjumlah lajur analisis, mengimbang Buku Tunai Runcit dan merekod rekupmen
  • 4.5.6Menganalisis dokumen sumber dan mengklasifikasikannya untuk menentukan perbelanjaan runcit berasaskan sistem panjar

Source: DSKP KSSM Prinsip Perakaunan Tingkatan 4

Key ideas in this chapter

What Books of Prime Entry are and where they sit in the cycle

Books of Prime Entry are the books used to record transactions for the first time, based on source documents, before they are posted to the ledger. They are not part of the double-entry ledger system directly; instead they collect information by type so that posting to the ledger is orderly.

The flow you must memorise is: source document, then Book of Prime Entry, then ledger, then trial balance, and finally financial statements. For example, when Perniagaan Maju sells goods on credit, the original invoice is the source document, the transaction is recorded in the Sales Journal, and at month end the total is posted to the ledger.

The General Journal: uses and double-entry format

The General Journal is used for transactions that do not belong in any special journal or the cash book. These include opening entries, the purchase or sale of non-current assets on credit, correction of errors, transfers between accounts, bad debts written off, and closing entries.

The General Journal format shows the account to be debited on top and the account to be credited below, slightly indented, followed by a short narrative. Example: buying a computer on credit from a supplier for RM3,000. The entry is Debit Equipment Account RM3,000, Credit Creditor Account RM3,000, with the narrative: purchase of equipment on credit.

Opening entries and bad debts in the General Journal

An opening entry records all balances of assets, liabilities and owner's equity at the start of an accounting period. For example, if Perniagaan Maju starts with Cash RM2,000 and a Vehicle RM8,000 financed by Capital RM10,000, the entry is Debit Cash RM2,000, Debit Vehicle RM8,000, Credit Capital RM10,000.

Bad debts are recorded when a debtor fails to pay. If a debtor named Ali owes RM500 and is confirmed uncollectible, the entry is Debit Bad Debts Account RM500, Credit Ali's Account RM500. This entry closes that debtor's account and recognises the loss.

Special Journals for credit purchases and sales

There are four special journals. The Purchases Journal records purchases of goods for resale on credit only, based on invoices received. The Sales Journal records sales of goods on credit only, based on copies of invoices sent out. Remember, the purchase or sale of non-current assets is never entered here.

Sales Journal example: selling goods on credit to Kedai Runcit Aman for RM600 and to Siti for RM400. The total of RM1,000 is posted as one entry, Credit Sales Account RM1,000, while each debtor is debited individually in the debtors ledger, Debit Kedai Runcit Aman RM600 and Debit Siti RM400.

Purchases Returns Journal and Sales Returns Journal

The Purchases Returns Journal records goods returned to suppliers, based on credit notes received. The Sales Returns Journal records goods returned by customers, based on copies of credit notes issued.

Sales Returns Journal example: customer Siti returns goods worth RM50 because they were damaged. The ledger entry is Debit Sales Returns Account RM50, Credit Siti's Account RM50. The monthly total of all sales returns is posted in one figure to the debit side of the Sales Returns Account.

Two-column and three-column Cash Books

The Cash Book records all receipts and payments of cash and money at the bank. It is unique because it serves as both a book of prime entry and the ledger account for Cash and Bank at the same time. A two-column cash book has Cash and Bank columns on both the debit and credit sides.

A three-column cash book adds discount columns, namely discount allowed on the debit side and discount received on the credit side. These discount columns are not part of the cash balance; they are memorandum columns whose totals are posted to the Discount Allowed and Discount Received accounts. Example: receiving RM380 from Ali to settle a debt of RM400 with a cash discount of RM20 is recorded as Debit Bank RM380 and Debit discount allowed column RM20.

Contra entries in the Cash Book

A contra entry occurs when money is transferred between cash and bank within the same business, for example depositing cash into the bank or withdrawing cash from the bank for office use.

Example: depositing RM500 cash into the bank is recorded as Credit the Cash column RM500 and Debit the Bank column RM500, both within the same cash book. This entry is marked with the letter C or the word contra in the folio column because both entries are in the same book and do not need to be posted to any other account.

The Petty Cash Book and the imprest system

The Petty Cash Book records small, frequent expenses such as stamps, stationery, drinks and fares. It is usually run on the imprest system, where the petty cashier is given a fixed float at the start of the period, and at the end of the period the amount spent is reimbursed so that the balance is restored to the original float.

Example: the float is set at RM200. During the month, RM150 is spent and recorded in analysis columns by type. The remaining cash is RM50. At month end, the main cashier reimburses RM150 so the balance returns to RM200. The total of each analysis column is posted to its own expense account in the ledger, for example Debit Stationery Account RM60, Debit Postage Account RM40, and so on.

Matching source documents to the right book

Each Book of Prime Entry is paired with a specific source document, and memorising these pairs makes questions much easier. The purchase invoice goes to the Purchases Journal, the copy sales invoice goes to the Sales Journal, the credit note received goes to the Purchases Returns Journal, and the copy credit note issued goes to the Sales Returns Journal.

Receipts and bank paying-in slips go to the debit side of the Cash Book, vouchers and cheque counterfoils go to the credit side of the Cash Book, and petty cash vouchers go to the Petty Cash Book. A good habit is to write the document reference number in the folio column of every entry so that the audit trail from source document to ledger stays clear and easy to re-check.

Common mistakes

Study plan for this chapter

  1. Start with the accounting cycle flow: memorise the sequence of source document, Book of Prime Entry, ledger, trial balance, financial statements, so you understand this chapter's role.
  2. Make a table matching the seven books to their source documents and the type of transaction they record, then test yourself without looking at your notes.
  3. Drill the General Journal format repeatedly with opening entries, credit asset purchases, bad debts and corrections, making sure the credit account is indented and a narrative is included.
  4. Learn the four special journals by writing your own example transactions, then post the total to the control account and debit or credit debtors and creditors individually.
  5. Practise the three-column Cash Book until you are comfortable with discount allowed, discount received and contra entries, and balance the Cash and Bank columns separately.
  6. Work through several Petty Cash Book questions using the imprest system, ensuring the balance returns to the original float and each analysis column total is posted to the ledger.
  7. Review the common mistakes list for this chapter before your exam and attempt past-year practice questions to confirm your formats are correct.

FAQ

What is the difference between the General Journal and a Special Journal?
Special Journals record frequent, repetitive transactions of one kind, namely credit purchases, sales and returns, so that only totals are posted to the ledger. The General Journal records rare or specific transactions such as opening entries, credit purchases of non-current assets, bad debts, correction of errors and closing entries that do not fit any special journal.
Why is the Cash Book said to be both a book of prime entry and a ledger?
The Cash Book records cash and bank transactions for the first time from source documents, making it a book of prime entry. At the same time its Cash and Bank columns are themselves ledger accounts that show balances, so no separate Cash Account or Bank Account is needed in the ledger.
What is the imprest system in the Petty Cash Book?
The imprest system means the petty cashier is given a fixed float at the start of a period. At the end of the period, the amount spent is reimbursed so the balance returns to the original float. For example, a float of RM200 with RM150 spent means RM150 is reimbursed to restore the balance to RM200.
How is a contra entry written in the Cash Book?
A contra entry occurs when money is transferred between cash and bank within the same business. For example, depositing RM500 cash into the bank is recorded as Credit the Cash column RM500 and Debit the Bank column RM500 in the same book, marked with the letter C in the folio column, and it is not posted to any other account.
I am still confused by journal formats. Can I get extra help?
Yes. Besides practising with notes and past-year questions, you can take online 1-to-1 tuition with our experienced teachers from RM50 an hour. The one-hour trial class is paid at the teacher's rate; WhatsApp for the exact rate. That said, regular practice of the formats is often enough to get this chapter right.

Learning materials for this chapter

Other chapters

Introduction to Accounting

Chapter 1

View

Classification of Accounts and the Accounting Equation

Chapter 2

View

Business Documents as a Source of Information

Chapter 3

View

Ledger

Chapter 5

View

Trial Balance

Chapter 6

View

Financial Statements of a Sole Proprietorship without Adjustments

Chapter 7

View

Adjustments at the Balance Date and Preparation of Sole Proprietorship Financial Statements

Chapter 8

View

Correction of Errors

Chapter 9

View

All chapters →

Need help with Books of Prime Entry?

One-hour paid trial · Same-day reply · from RM50/hr

Book a Trial Class
Book a Trial Class

One-hour paid trial · Same-day reply