Main purpose of maintaining books of prime entry(orginal entry) in a business?

Question

Main purpose of maintaining books of prime entry(orginal entry) in a business?

Answer 1

There are different books of prime entry: the Special Journals, the General Journal, the Cash Book, and the Petty Cash Book.

Books of prime entry are used so that:

1. similar transactions are recorded into one book in order of date (e.g. credit sales are recorded into the Sales Journal)

2. unnecessary detail in the General Ledger is cut down as only totals are posted to the GL.

The use of special journals provides an important middle step between source documents and the ledger accounts.