Biss Docs Flashcards
What are the three different types of business entities?
Sole trader, limited company, partnership
What are financial statements based on?
The businesses financial recors
What is financial statement?
Measure performance and year end position
How do you make sure financial records are accurate?
All trans are supported by business documents
What is a financial document?
Is a document that is recorded in a book of prime entry
What other words are used to describe sales income?
Revenue and sales revenue
An invoice being issued is a cash or credit sale?
Credit
What are the six stages of business documentation?
Quotation, customer order, delivery note, invoice, credit note, remittance advice
What happens if documents aren’t complete accurate and invalid?
They can delay the sale of goods or the provision of service
Hinder payment for goods and service
Lead to errors in the accounting record
What errors can occur in documentation?
Name of the customer supplier, or services provided, product codes, price per unit, quantities, discounts and VAT
How can you check documentation in your exam?
Check the details on the sales order I’m actually the delivery note which match the invoice
What is a customer order?
Is a request by a customer to purchase a specific quantity of goods from an individual or organisation?
What is a delivery note?
A note that accompanies the shipment of goods
When does an invoice get provided?
When the good service service has been supplied and therefore the delivery note has been sent to the customers the accounts will raise an invoice
How do you work out VAT?
You divide the net by 100 then times by 20
When do you issue a credit note?
When an invoice has already been issued, raising a credit note or reduce the amount owed by the customer
What is the credit note similar to?
An invoice
Should’ve credit note contain the reason for the credit note
Yes
What do you need to remember when preparing an credit note?
Whether a discount was applied and needs to be included on the credit note
What must be done before petty cash is given out
Petty cash voucher which is an internal document must be completed and authorised before, receipts then attached to the voucher
Why did invoices have a customer code?
To denote the particular customer
What code invoices and credit notes routinely include?
Project codes for the item sold
What can’t you see from business documents alone?
The amount of income the business is generated
The expenditure incurred
How much cash has been received received and paid?
What customers still owe money to the business?
What supplies are awaiting payment from the business?
What is the book of prime entry?
This is entering details from key business documents into the appropriate book of prime entry
