chapter 7 Flashcards
concept of trade credit
supplier
a person or organisation that provides the goods/ materials or services to the enterprise
trade payable
the amount of money owed by the enterprise to suppliers such as for raw materials but not paid for
revenue
the money that comes into an enterprise from selling goods and services
calculation for revenue
selling price x quantity sold
trade credit
buy now pay later
if enterprise doesnot pay back in the agreed no. of days then the amount increases
downsides for offering trade credit to a customer
enterprise doesnt get their money straight away resulting in cash flow problems
chasing late payment can be costly bc of time
customer
a person or organisation that guys goods/ materials or services from an enterprise
trade recievable
the amount of money owed to the enterprise after getting the goods
goods
the finished product sold by enterprise
cash
the movement of money in and out the enterprise
service
something that an enterprise might do for their customers
materials
the raw components that a used to make the goods
