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JC Business Docs
JC Business Docs Work in Progress
| Question | Answer |
|---|---|
| Buying on credit means... | buy now, pay later |
| An individual’s or a business’ credit rating may be checked by: | Looking up the Stubbs gazette, Contacting other business’ who have dealt with them |
| Treatment of orders by the seller | Date-stamp the order, Get the products ready for delivery, Send order to the office for preparation of delivery docket and invoice, File a copy of the order |
| Treatment of incoming delivery dockets: | Check it against incoming the order to make sure you are receiving what you ordered, File it away and check it against the invoice when it arrives |
| Treatment of outgoing delivery dockets: | Check the name and address of buyer are correct, Check the details are as per order, File a copy, Ensure the docket is signed by the buyer when good are received |
| Treatment of outgoing invoices | Compare prices with quote given, Check calculations for accuracy, Check address of customer, Write in Sales Day Book and post to debtors ledger, File a copy |
| Treatment of incoming invoices | Compare with order and delivery docket, Check accuracy of prices and calculations, Write in Purchases Day book and post to creditors ledger, File a copy |
| Invoice | This is a bill for the goods. |
| Credit Note | Sent from seller to buyer if they have been overcharged or have received faulty goods |
| Treatment of outgoing credit note | Check figures and dates for accuracy, Record in Sales Returns Day book, File a copy |
| Treatment of incoming credit note | Record in Purchases Returns Day book |
| Statement of Account | A document sent from the seller to the buyer at the end of a period of time, usually a month. It outline the transactions that took place between the seller and the buyer during that time |
| Treatment of outgoing Statements of Account | Check all transactions are included and correct, Check the name and address of the buyer, File a copy |
| Treatment of incoming Statements of Account | Compare with relevant documents, Compare with Creditors Ledger, Check all calculations, Pay seller amount due, File a copy |
| Receipt | When the seller receives payment it is usual to issue the buyer this. |
| Treatment of outgoing receipts | Check figures and dates for accuracy, Check the name and address are correct, Record in the Analysed Cash Book on debit side, Keep a copy |
| Procedure for dealing with complaints | Listen to the complaint, Investigate the complaint, Take the necessary action, Reply to the complaint, File a record of the complaint |
| Effective Purchasing Involves.... | Finding the best price, Making sure the goods will arrive on time, Making sure you order the correct amount. Not too much, and not too little, Choosing a reliable supplier and delivery company, Checking that goods delivered match the delivery docket |
| Why businesses sell on credit | To increase sales an profits. To compete with businesses who only sell for cash. To facilitate customers who require tome to pay for goods purchased. E.g builders |
| Bad Debts | Arise when the buyer does not pay the seller what they owe. They are written of as an expense by the seller |
| Terms and conditions | An agreement sent by the seller to the buyer that shows the price of the goods and the terms and conditions of sales. Includes items such as: date of delivery, cost of delivery and discount for cash sales. |
| VAT | Value Added Tax. Is a tax added on to the value of a good or service. |
| Cash discount | an extra discount given to the buyer if they pay promptly within the state period of time. |
| Ex-works | the buyer must pay for the transportation of the goods from the factory. |
| Cash with order (CWO) | payment for the goods is required at the time of ordering the goods. |
| Cash on delivery | Payment for the goods is required when the goods are delivered. |
| Trade discount | A reduction the selling price given when the buyer and seller are in the same area of business. It is deducted before VAT is added to the price. |
| Carriage paid | The seller will pay for the delivery of the goods to the buyer. |
| Errors and omissions excepted (E & EO) | Is often added to business documents. It is used to say that a price list, product description or other document may contain mistakes or may not include some details. However, it has no legal force. |
| Delivery Docket | Comes with the goods and is signed by the customer as proof of delivery |
| Order Form | You fill this in with the details of the goods you want to buy |
| Quotation | Sent to the buyer with details of the best prices they can offer, any discounts and the terms of sale. |
| VAT | Value Added Tax. |
| Credit Note | Issued by the seller if goods are returned or if they overcharged the customer. |
| Debit Note | Issued by the seller if they undercharged the customer. |
| Invoice | Shows what was delivered ;full details of cost and when it is to be paid. |
| Statement | This is sent at the end of each month. It lists all the invoices and credit notes for the month. |
| Receipt | Proof of payment for goods or services. |
| Credit Rating | The buyers ability to pay for goods purchased. This shows whether the customer has a good record of paying on time. |
| Payment | Paying for goods or services. This can be by cash, cheque, bank transfer, credit cards etc. |
| Bulk buying | Buying goods in large quantities. |
| Effective purchasing | Getting value for money by buying goods at the right price, quantity and quality. |
| Letter of enquiry | Sent to potential suppliers to check the best deals they can offer. |
| Terms of Sale | These can be payment terms, discount terms or transport terms. |
| Credit offered | The customer received the goods but pays for them later. |
| Trade discount | A reduction in price. The supplier may give this to other businesses, on goods that are obsolete or if they buy in bulk. |
| Carriage | Transport costs/ Delivery costs. |
| F.O.R | Free On Rail. Delivery is free to the nearest railway. |
| F.O.B | Free On board. Delivery is free to the nearest port. |
| Unit Price | The price per ONE product. |
Created by:
MrFromholz
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