chapter 6 - business documents

Question 1

definition of:

invoice

Answer 1

a document issued by supplier of goods on credit showing details, quantities and prices of goods supplied

Question 2

definition of:

trade discount

Answer 2

a reduction in the price of goods; the rate often increases according to quantity purchased (buy in bulk)

Question 3

definition of:

debit note

Answer 3

a document issued by a purchaser of goods on credit to request a reduction in the invoice received

• due to overcharge, faulty goods, damaged
• never entered in accounting records

Question 4

definition of:

credit note

Answer 4

a document issued by a seller of goods on credit to notify a reduction in an invoice previously issued

Question 5

definition of:

statement of account

Answer 5

a document issued by supplier of goods on credit to summarise the transactions for the month

-never entered in accounting record

Question 6

definition of:

cheque

Answer 6

a written order to bank to pay a stated sum of money to the person or business named on the order

Question 7

definition of:

receipt

Answer 7

a written acknowledgement of money received and acts as proof of payment