Business-Exam 2 Flashcards
the documents prepared to record the details of a transaction.
source documents
what are four things accurate and up-to-date source documents do?
- make it easier to complete and prepare the annual financial reports
- provide details for the preparation of BAS
- help to avoid penalties for neglecting to keep records required by law
- contain additional useful information, usually not part of the accounting entries.
Common features in most source documents (4):
- date the transaction occurred
- the name and address of parties
- the nature of the transaction
- the amount of money involved
what kind of storage systems would most businesses use for their financial records?
a combination of paper and computer
what does GST mean?
Goods and Services Tax
What is GST?
a broad-based tax of 10% on most goods and services consumed in Australia
what can GST registered organisations do?
They can claim an input tax credit for the GST included in the price of goods and services they buy
How do you claim GST back?
lodge a Business Activity Statement
who should keep record of all GST collected and paid?
the Treasurer
what is the formula to FIND GST?
formula: y/11=GST amount
formula to find ADDED GST?
formula: y x 0.10 = GST
y + answer = TOTAL AMOUNT
what will GST be included in?
- cash register summaries
- cash purchases
- cash receipts
- sundry expenses
What will GST NOT be included in?
- payment of settlement accounts
- wages
- donations
- raffle and social proceeds
What items are exempt of GST?
Health and Medical e.g. health insurance
Educational supples and childcare e.g. school fees
Fresh food and beverages e.g. vegetables
which source documents go from the buyer to the seller (2)?
- purchase order
- cheque
which source documents go from the seller to the buyer (4)?
- tax invoice
- consignment note
- adjustment note
- statement of account
what is a purchase order?
a document used to place an order for goods or services
how can these be placed? (6)
- faxed, .mailed or emailed
- telephone
- using a Personal Digit Assistant (PDA)
- seller can come to buyer
- buyer can go to seller
- trade shows
what is a tax invoice?
a bill provided to a customer after receiving an order, indicating the goods or services purchased and the amount owing. Tax invoices must always be issued, except when the supply is under $50 and the customer has not requested one
on receipt of the tax invoice the purchaser should? (4)
- Double-check all tax invoice calculations, including the GST and trade discount
- Contact the supplier if any discrepancies are found so they can be quickly rectified
- Record the due date for payment of the debt
- Follow the procedures to ensure that payment is made within the designated timelines.
What do these abbreviations mean:
- N/7
- 2/7
- 2/7; N/30
- EOM
- Net seven days- the debt must be repaid within seven days
- A 2% discount can be deducted from the tax invoice if the debt is repaid within seven days
- a 2% discount applies if the debt is repaid within seven days, or repay the full amount within thirty days
- Account to be settle by the last day (end) of the month
What is a consignment note?
are prepared when goods are ready to be despatched to the purchaser, often referred to as con-note)
How can they be prepared?
manually or produced electronically
Before goods are despatches, what should the supplier check?
- the order has been filled as requested
- the goods are appropriately packaged for transportation
- the delivery details are correct
- the goods can be delivered in time
what are adjustment notes?
also known as credit notes, they are almost identical to tax invoices and are prepared for a variety of reasons
reasons for adjustment notes:
- the product delivered is damaged
- overcharged
- under supplied
