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Why is the cash book considered both a book of prime entry and a ledger account? How is VAT recorded in the books of prime entry? What is a trade discount and how is it treated in the day books? How do you post the purchases returns day book? What controls help ensure completeness and accuracy in the books of prime entry? What is the accounting equation and how does bookkeeping maintain it? What is the difference between capital and revenue expenditure? How does a settlement (cash) discount get recorded compared with a trade discount? How do the books of prime entry contribute to the double-entry system? How would you record the purchase of a non-current asset on credit in the books?
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What is a remittance advice and how does it relate to the books of prime entry?

Intermediate

Answer

A remittance advice accompanies a payment and lists the invoices being settled. It's a source document that helps the bookkeeper record cash received in the cash book and allocate it correctly to customer accounts in the sales ledger, reducing unallocated cash and posting errors.
Real-world example A customer's remittance advice lets the bookkeeper match a lump-sum receipt to the specific invoices it clears.

Common follow-ups: How does it aid cash allocation? | Which book of prime entry uses it?

Cash Book & Petty Cash Sales & Purchase Ledgers Books of Prime Entry
All 26 Books of Prime Entry questions