Cambridge IGCSE Accounting: Sources and Recording of Data — Revision Notes

Syllabus edition note. This resource follows the Cambridge IGCSE Accounting 0452 syllabus for exams in 2027, 2028 and 2029 (version 1), first examined in the March 2027 series in India and the June 2027 series elsewhere. If you sit 0452 in November 2026, you sit the 2026 syllabus (version 2), which differs: Paper 1 has 35 multiple-choice marks in 1 hour 15 minutes, not 40 marks in 1 hour 30 minutes; Topic 7 is “Accounting principles and policies”, without 7.2 Ethical considerations or 7.3 Technology and sustainability; 4.4 is “Irrecoverable debts and provision for doubtful debts”; income statements are named instead of statements of profit or loss; three-column running balance accounts are not required; Clubs and societies is 5.4 and Manufacturing accounts 5.5; and 6.3 is “Inter-firm comparison”. For this topic, the 2026 syllabus also asks candidates to complete pro-forma business documents and to explain the advantage of using books of prime entry, and it does not include digital ledger accounts or the benefits and limitations of keeping cash at the business property and of manual and digital original entry. If you sit in November 2026, work from the 2026 syllabus on the Cambridge International website.

Condensed for the final weeks. For the full explanation, use the Sources and Recording of Data study guide.

The double entry rule

Debit the receiving account, credit the giving account. Not a formula to memorise — practise deriving the entry from first principles for a genuine mix of transactions (cash purchase, credit sale, return, owner’s drawing) until it is automatic. Folio columns are not required, but ledger accounts may be presented in three-column running balance format, so be ready for both layouts.

Business documents — recognise and use, not redraw

Document	Purpose
Invoice	Requests payment for goods/services supplied
Debit note	Requests a correction (e.g. undercharge)
Credit note	Corrects an overcharge or records returned goods
Statement of account	Summarises the account’s transactions and balance
Cheque counterfoil	The payer’s record of a cheque paid
Paying-in slip	The business’s record of money paid into the bank
Receipt	Confirms that payment has been received
Bank statement	The bank’s record of the account, used to check the cash book

Know why each is issued and how debit note and credit note differ in direction: the syllabus asks how each is used as a source of information. Documents may be produced and recorded manually or digitally.

The seven books of prime entry

Cash book, petty cash book, sales journal, purchases journal, sales returns journal, purchases returns journal, general journal. A book of prime entry is where a transaction is FIRST recorded from a source document; the ledger is where it ends up after posting — keep this distinction sharp.

The cash book is unusual: it is simultaneously a book of prime entry AND a ledger account for cash and bank — the only one of the seven with this dual role.

Worked example: tracing one transaction end to end

A credit sale of goods, later partly returned by the customer.

Step 1 (sale):     invoice issued -> recorded in the sales journal
                   (book of prime entry) -> posted to the customer's
                   account in the sales ledger and to the sales
                   account in the nominal ledger
Step 2 (return):   credit note issued -> recorded in the SALES
                   RETURNS journal (NOT reversed directly in the sales
                   journal) -> posted to the customer's account
                   (credit side) and the sales returns account

Forgetting that a sales return goes in the sales returns journal — not reversed directly in the sales journal — is one of the most common structured-question errors on this topic.

Running balance format

Date     Details         Debit $  Credit $  Balance $
1 Mar    Balance b/d                          300 Dr
8 Mar    Sales              450               750 Dr
15 Mar   Bank                        500      250 Dr
20 Mar   Sales returns                50      200 Dr

Same double entry as a two-sided account; a balance after every line, always labelled Dr or Cr.

The imprest system: purpose and calculation

Purpose: to control small cash payments. The float is restored to the same fixed amount each period, and spending is checked against vouchers whenever it is restored.

Amount to restore = total of the vouchers = float − cash left. A $200 float with $148 of vouchers needs $148 to restore it (and $52 should be left in the tin). Marks are lost here through arithmetic slips, not conceptual misunderstanding.

Cash, manual and digital records

	Benefits	Limitations
Cash kept at the business	Available for small, immediate payments and change	Theft, loss and miscounting; secure storage; earns no interest
Manual original entry	Cheap; no equipment; unaffected by system failure	Slow; arithmetic and copying errors; hard to back up and search
Digital original entry	Fast; automatic totals and postings; easy backup and reports	Set-up and training costs; system failure or data loss; input errors post everywhere

Receipts and payments may be made by cash, cheque, debit or credit card, online or bank transfer. Ledger accounts can be kept digitally.

Trade discount vs cash discount

A frequently confused pair: trade discount is a reduction given at the point of sale (often for bulk purchase) and is never entered in the accounts at all — the invoice simply shows the discounted price. Cash discount is a reduction offered for prompt payment and IS recorded in the accounts, in the discount allowed/discount received columns of the cash book. Confusing the two — for example, trying to post trade discount as a ledger entry — is a common structured-question error.

Ledger divisions

The ledger is divided into the sales ledger (customers’ personal accounts), the purchases ledger (suppliers’ personal accounts), and the nominal (general) ledger (all other accounts — assets, expenses, income, capital). Knowing which ledger a given account belongs in is tested directly alongside the double-entry postings themselves, particularly in scenario questions that present a mix of customer, supplier and expense transactions together.

Exam traps

• Leaving the Dr/Cr label off a running balance, or treating the imprest amount to restore as the cash left rather than the amount spent.
• Confusing a book of prime entry with a ledger account.
• Posting a sales return directly against the sales journal instead of the sales returns journal.
• Miscalculating imprest reimbursement through arithmetic error rather than conceptual confusion.

The cash book’s dual role, explained

Most books of prime entry get posted TO a ledger account — but the cash book IS a ledger account (for cash and bank) as well as being where cash/bank transactions are first recorded. This is why the cash book is never itself “posted” to a separate cash or bank ledger account the way the other six books of prime entry are posted to their respective ledgers — understanding this dual role prevents a common structured-question error of treating the cash book like an ordinary book of prime entry that needs a separate posting step.

Practising the full document-to-ledger trace

Because Paper 2’s structured questions often present a mixed bag of source documents in one scenario, practise identifying, for each document type, its correct book of prime entry and final ledger destination as a fast, automatic three-step lookup: document → book of prime entry → ledger account. Building this as muscle memory before the exam is more valuable than memorising each of the seven books’ definitions in isolation, since scenario questions rarely test a single book on its own.

Self-test

1. State the double entry rule in one sentence.
2. What is the key difference between a debit note and a credit note?
3. Which book of prime entry also functions as a ledger account?
4. Where should a sales return be recorded — and where is it a common error to record it instead?
5. How much is needed to restore an imprest float?

Answers: 1. Debit the receiving account, credit the giving account. 2. A debit note requests a correction such as an undercharge; a credit note corrects an overcharge or records returned goods — opposite directions. 3. The cash book. 4. It should be recorded in the sales returns journal; a common error is reversing it directly in the sales journal instead. 5. The total of the vouchers paid in the period, which equals the float minus the cash left.