If you have thoroughly understood the section on the sales ledger you will have no trouble at all understanding this section on the purchase ledger. This is because the purchase ledger is a mirror image of the sales ledger. It is used for invoices submitted to the business by suppliers.
The layout is similar to the accounts in the nominal ledger and the sales ledger. Postings to it are:
Credit suppliers’ invoices received Debit
suppliers’ credit notes received
Debit cash payments made
Each account will normally have a credit balance and this represents the amount owing to the supplier by the business. The total of all the individual purchase ledger accounts is the same as the amount of the purchase ledger control account in the nominal ledger. Customers will submit statements to you and press you to make regular prompt payments to them.
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