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What is the Difference Between Purchase Book and Purchase Account?

Difference Between Purchase Book and Purchase Account

Purchase Book – It is a subsidiary book of accounting used to record all goods purchased on credit. One of the major difference between purchase book and purchase account is that only the items purchased related to the core business operations are recorded in the purchase book, whereas the same is not applicable to a purchase account. All capital expenditure is excluded from the purchase book.

Purchase Account – It is a ledger account just like any other account in business. It is a part of the chart of accounts and it is used to record the journal entry for cash and credit purchases. It includes all stock related transactions which help a business to ascertain the amount of inventory available at any time.

 

Difference between purchase book and purchase account – Table Format

Purchase BookPurchase Account
1. It is a part of the journal.1. It is a part of the ledger.
2. As it is a special-purpose book it doesn’t have a debit and credit column.2. Since purchase account is a ledger account it has both debit and credit columns.
3. The balance in purchase book is posted to the purchase account regularly.3. The balance in the purchase account is further moved to the trading account.
4. Only credit purchases related to the core business are recorded in the purchase book.4. All cash and credit purchases related to the core business are journalized and entered in this account.

Related Topic – Difference between Sales Book and Sales Account

 

Sample Format of Purchase Book and Purchase Account

Purchase Book

Purchase Book

 

Purchase Account

Sample Format of a Ledger

 

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