Source Documents - JSS1 Business studies Past Questions and Answers - page 2
What type of document instructs the bank to pay a specified amount to a person or organization?
Credit notes
Debit note
Cash register tapes
Cheques
Which source document indicates an increase in the amount owed by the buyer?
Sales invoice
Debit notes
Receipts for payments made
Purchase invoices
Which source document provides details of goods or services sold by a seller to a buyer?
Credit notes
Cash register tapes
Sales invoice
Cheques
What is the primary purpose of debit notes?
To indicate an increase in the amount owed by the buyer
To create confusion in accounting records
To entertain office employees
To reduce the amount owed by the buyer
What is the significance of source documents in accounting?
Source documents serve as the original records of business transactions, providing evidence for recording financial data accurately. They ensure transparency, compliance with regulations, and facilitate auditing processes.
Explain the difference between a sales invoice and a purchase invoice.
A sales invoice is issued by a seller to a buyer, detailing the goods or services sold, their quantity, price, and terms of sale. On the other hand, a purchase invoice is received by a buyer from a seller, containing information about the goods or services purchased, along with relevant terms and conditions.
How do credit notes and debit notes impact financial transactions?
Credit notes are issued by sellers to buyers, indicating a reduction in the amount owed by the buyer, often due to returns or discounts. Conversely, debit notes are issued by buyers to sellers, indicating an increase in the amount owed, typically for additional charges or corrections to previous invoices.
What information is typically recorded on cash register tapes?
Cash register tapes usually record transactions made in cash at the point of sale. They include details such as the date, time, items purchased, and the total amount of the transaction.
How do receipts for payments made contribute to financial record-keeping?
Receipts for payments made serve as evidence of payments received for goods or services provided. They document the date, amount paid, and method of payment, helping to maintain accurate financial records and providing proof of transactions.
Why are cheques considered important source documents in business transactions?
Cheques are important because they serve as written orders from an account holder to their bank, instructing the bank to pay a specified amount to a person or organization. They provide a formal record of payments made through the banking system, facilitating financial transactions and ensuring accountability.