Financial Documents for Sales

Question 1

Seller

Answer 1

a person who sells something

Question 2

Price Quotation

Answer 2

giving a fixed price for a product to a potential buyer

Question 3

Purchase Order

Answer 3

a doc sent to the seller indicating what goods/services the buyer requires

Question 4

Delivery Note

Answer 4

a doc sent to the buyer with the goods, detailing what has been sent

Question 5

Invoice

Answer 5

a doc indicating the amount owed to the seller and the required payment date

Question 6

Returns Note

Answer 6

a customer returning goods they have bought

Question 7

Credit Note

Answer 7

a doc issued by the seller of the goods/services reducing the amount owed by the buyer

Question 8

Statement

Answer 8

summarises invoices, credit notes issued, payments received and money owed by the buyer

Question 9

Coding

Answer 9

doc references using numeric, letters or alpha-numeric identification systems

Question 10

Discrepancies

Answer 10

unintentional mistakes in financial docs

Question 11

Value Added Tax

Answer 11

a government tax on sales- calculated on invoices and credit notes

Question 12

Product Code

Answer 12

catalogue number which appears on the original purchase order and delivery note

Question 13

Description

Answer 13

the goods must be specified precisely

Question 14

Quantity

Answer 14

the amount of goods requested by the buyer

Question 15

Price

Answer 15

the price set for each good/service and what they buyer pays

Question 16

Unit Price

Answer 16

a products average price- the unit is counted and charged for

Question 17

Total

Answer 17

unit price * number of units

Question 18

Net

Answer 18

the amount due to the seller after deduction of trade/bulk discount and before VAT is added on

Question 19

Goods Total

Answer 19

the amount due to the seller

Question 20

Total

Answer 20

VAT + Goods Total: final amount due to seller

Question 21

Net Monthly

Answer 21

full payment of an invoice should be made within a month of the invoice date

Question 22

Carriage Paid

Answer 22

the price of goods includes delivery

Question 23

E & OE

Answer 23

Errors and Omissions Excepted- if there is an error or incorrect final price, the supplier can demand the correct amount

Question 24

Consignment

Answer 24

a batch of goods destined for or delivered to someone

Question 25

Statement of Account

Answer 25

shows what is owed by the buyer to the seller

Question 26

In the Statement of Account:

Answer 26

• balances owed at the start of the month (debit column), balance b/f (brought forward)
• payments received from the buyer (credit)
• invoices issued for goods supplied- full amount due (debit)
• refunds made on credit notes, with VAT (credit)
• the running balance, final net total of all items
• bank details required for making payments by BACS or faster payments

Question 27

BACS Payment

Answer 27

payment made directly from one bank account to another

Question 28

Faster Payments

Answer 28

payments arrive quickly between the banks

Question 29

HMRC

Answer 29

government department that collects taxes, payments and issues NI numbers

Question 30

Discrepancies can occur:

Answer 30

• before the doc is issued- in the internal checking process
• the buyer finds the discrepancy after doc has been issued