Indexes in primary keys

I have a 3rd party app which had a primary key with about 5 fields. The last field of this was a trantype. This app had a posting process which uses this in it's sql. Ran rather slow. We added an individual index to this field and cut processing down 90%. It almost seemded like sl server was ignoring this index. Is this because it was the last field in the primary key index?

Exactly right. It was actually much faster for SQL Server to scan the whole table instead of the composite index, so that was what it was doing.