4.6 - Record Keeping Strategies

Question 1

Importance

Answer 1

It is important that a Business records its financial transactions so that it has the material available to establish its financial performance and to produce the information needed to complete its GST and Income Taxes Requirements for the ATO.

Question 2

Source Documents

Answer 2

• These documents are the source of the business financial transactions and are used to provide proof of them to the ATO.
• Includes: Cash Receipt, Proof of Payment, Invoice, Bank Statement

Question 3

Balance Sheet

Answer 3

• A summary of Financial Performance at a given point in time. It will show assets (owns), Liabilities (owes), and Proprietorship (The owner’s amount)
• Assets - Liabilities - Owner’s Equity

Question 4

Reports

Answer 4

• This is a Summary of the Financial Transactions
  
  • Income Statement
  • Revenue
  • Sales
  • Fewer Expenses
  • Rent
  • Electricity
  • NET PROFIT or loss)