P1 Identifying the Documents Used to Record Business Transactions

P1 Identifying the Documents utilize to Record Business Transactions 1. Issue of a grease ones palms Order Apurchase ball club (PO)is papers issued by the emptorto theseller, indicating types, quantities, and agreed prices for products or run the seller allow for provide to the buyer. send a purchase order to a supplier is a legal offer to buy products or services. If the seller agrees to selling to the buyer it forms a contract between the two. It should include * The order come up, so it rout out be traced and matched with banknotes and statements * The purchasers name and voice communication which is usually across the middle of the document * The price The name and address of the supplier * The catalogue/reference number * Authorisation i. e. signature and date * A description of the goods required The livery Address May Be Different Companies use Purchase Orders for several reasons price * Purchase orders allow buyers to clearly and explicitly communicate their inte ntions to sellers * Sellers are protected in case of a buyers refusal to generate for goods or services * Purchase orders help a purchasing agent to manage incoming orders and pending ordersIf The Order Is Not Properly Authorised It Will Not Be Processed 2. Delivery cross off This is the document is move with the goods. It lists the items which have been direct. The buyer uses this to check the goods ordered have arrived. It is signed by the buyer and it is so send back to the seller as a proof of delivery. The person receiving the goods signs it after analyse the quantity of the goods delivered. Information on the Delivery Note * The method of delivery * Purchase order number * The signature of the person receiving the goods * The catalogue number and quantity The Price Is Usually Not On the Delivery Note 3. chronicleAninvoice is a document issued by asellerto thebuyer, indicating theproducts, quantities, and agreedpricesfor products orservicesthe seller has provided the bu yer. An invoice indicates the sale transaction nevertheless. Payment terms are usually included on the invoice. The buyer can also have a maximum number of days in which to wage for these goods and is sometimes offered a discount if paid before the due date. This is probably the most important document. This is an authoritative request for honorarium. It includes * The WordInvoice * A Unique Reference Number In Case Of counterweight About The Invoice * Date of the Invoice. Tax Payments * Name And Contact inside information Of The Seller * Tax Or Company Registration Details Of Seller * Name And Contact Details Of The Buyer * Date That The fruit Was Sent Or Delivered * Purchase OrderNumber * Description Of The Products * Total Amount Charged optionally with breakdown of taxes, if relevant * Payment Terms method of payment, date of payment, and details about charges for late payment * The Purchase Order Number the invoice is checked against the goods ordered, the invoice and the goods delivered, the process is called marrying up. The buyer only pays if all three documents match exactly. Terms this informs the buyer how long before he has to pay for the goods. The measuring rod of cash discount for fast payment will also be stated. * Carriage this states the constitute of conveying the seller has to pay. Carriage forward means how much the buyer has to pay for transportation * E OE errors and omissions anticipate this allows the seller to correct any mistakes on the invoice at a later date. * Trade dismiss this amount will be deducted from the invoice price e. g. buying in bulk. * Value Added Tax ( bathtub) this is added to the cost of the goods on the invoice.Read also Recording General Fund Operating Budget and Operating TransactionsThe VAT registration number should be on the invoice, usually below the name and address. * Invoice Number it will identify a specific invoice for the buyer and seller. Pro Forma Invoice VAT It means for forms s ake. It is sent to a new customer, or an existing customer who has been late making a payment It is sent to the buyer before the goods are delivered The details are the same as on an ordinary invoice. The goods are delivered after the payment has been made.When the goods are paid for a normal invoice is issued. It sets out charges which have to be paid in advance. Debit Note This is issued by the seller and sent to the buyer. It Is Essentially an Additional Invoice It is used to correct errors e. g. if goods were invoiced at a lower price than it should been or if some goods were over charged. 4. reliance Note Acredit circular is a document issued by asellerto abuyer. The seller usually issues a credit memo for the same or lower amount than the invoice, and then repays the money to the buyer or sets it off against a balance due from other transactions.A credit furrow lists the products, quantities and agreed prices for products or services the seller provided the buyer, but the bu yer returned or did not receive. It may be issued in the case of damaged goods, errors or allowances. In respect of the previously issued invoice, a Credit memoranda will reduce or eliminate the amount the buyer has to pay. Reasons for issuing a credit note * To correct a mistake e. g. being over charged * Goods are faulty or damaged * The goods were not delivered * The wrong goods were delivered Details on the credit note include The date * The original invoice number * Date * The reason credit is being given * The addresses of the buyer and seller It Is Often Printed In Red 5. Statement The seller sends all regular customers a statement at the end of the month. This Is a Copy of The Customers Accounts in The Sales Ledger. It lists all transactions with customers during the month * all payments true * All invoices issued * It shows outstanding balance * Any credit note issued Details include * Date * Details of invoices issued * The name and address of the customers The customer s account number * The name and address of the supplier * Any credit note issued * Any payments made * The amount outstanding i. e. the balance 6. Goods Received Note(GRN) This is an internal document used by the buyer, usually in the stock department to record goods being delivered. Copies are sent to various parts of the business * The department that ordered the goods, to let them know that goods have arrived * The accounts department so they can marry the invoice, the purchase order and the GRN * The purchasing department who placed the order.