Drafting supplier journals
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Video Overview

Most business today use preferred suppliers on a continuous basis, therefore it is very common today for accounts to be set up with suppliers so that transactions are purchased on credit and the account is settled at a later date. One advantage of this is that early settlement discounts may be offered by the supplier as an incentive for early payment as well as enticing repeat purchases. Some large businesses have a separate accounts department solely for these supplier accounts, therefore a bookkeeper may work all day at keeping these accounts up-to-date and the balances reconciled with the statements sent by the suppliers. Supplier accounts may also be referred to as creditors accounts so for the purpose of this tutorial we will refer to the creditors journal and the creditors allowances journal when referring to the journals used to record transactions involving suppliers.