Chapt 3 Recording Financial Transactions

Question 1

What are the benefits of computerised accounting systems

Answer 1

Speed of processing large volumes of transactions
Inbuilt controls to reduce errors
Can store and shar huge amounts of data
Frees up accountants time to focus on high level tasks

Question 2

Different accounting systems

Answer 2

Off the shelf (sage)
Bespoke systems

Question 3

Underlying elements of comp accounting systems

Answer 3

Inputs - source docs
Processes - ledgers, journals, calcs, record keeping
Outputs- reports, TB, fs

Question 4

What are the steps of credit sales systems and what is the source doc

Answer 4

Customer order (Sales order)
Dispatch goods (goods deliver note)
Raise invoice (sales invoice)
Receive payment

Sales invoice is the source document

Question 5

Credit purchase system

Answer 5

Purchase order
Goods received
Receive invoice
Make payment

Purchase invoice is source doc

Question 6

What are credit notes

Answer 6

Documents issued to customers relating to returned goods or refunds when customer overcharged

(Is like a negative invoice)

Question 7

What is the imprest systems

Answer 7

Systems for petty cash where the petty cash value is kept at an agreed sum

Question 8

What do you replace cash used out of petty cash with

Answer 8

Vouchers detailing the expense

Cash + voucher = float amount

Question 9

What is gross pay equation

Explain aspects that aren’t pay related

Answer 9

Gross pay = net pay + deductions

Deductions = PAYE, NI, Pension cont