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The types of financial transactions and documents which would take place in a business organisation.

Extracts from this document...

Introduction

Introduction: In this assignment I am going to show all the types of financial transactions and documents which would take place in a business organisation. To establish that I fully understand all the financial documents I will produce evidence which shows actual documents from a business with a explanation. I will obtain all the purchase, sales documents and examples of payment method and receipt documents. Also I will explain the financial transactions which take place regularly in an organisation and an explanation of why transactions are kept. Security in a business is very important issue therefore I will explain the methods in ways that business goes to length to prevent fraud and theft. The information will be obtained from the "Heinemann GNVQ for business studies" text book. Explain and give examples of purchases and purchase documents: Purchases: 1) Materials. 2) Services. 3) Wages. Purchase documents 1) Order Placed. 2) Purchase Invoice 3) Credit Note 4) Goods received Note. Purchases Materials 1) When organisations are started they need to buy certain things so the business operates properly. One of those things are Materials. These materials are called business materials. These are materials used to make the business product. For example wood is a business material for a furniture maker. He buys the wood from a supplier and then manufactures the furniture. ...read more.

Middle

For example banks offer their financial services to individuals who need loans or advice. Sales Documents 1) Order received ( see example 5) This document is produced by the supplier and is sent to the customer. This is used to conform with the customer what they have ordered. Details like the product description and how many they require are written down. 2) Sales Invoice (see Example 6) This document is sent to the customer to tell them how much they owe. Its similar to the purchase invoice and includes things like VAT and discounts. Also it includes the description of the product. The sales invoice is different because its's only issued when a good has been delivered and has not paid for unless the customer has paid immediately. Delivery Note (see Example 7) A delivery note is given to the customer when the goods are delivered. The documents tells you what has been delivered and how many has been delivered. Also on it is the customers address so its similar to the goods received note. This document is a security measure so the right goods end up in the right place. The delivery note is given to the driver of the truck who deliver the goods and is then passed on to the customer. ...read more.

Conclusion

They can be used at home and abroad wherever they are accepted. Instead of handing over cash or a transaction voucher by the customer. This voucher is then sent to the bank, who then sent the customer a statement saying hour much they owe. The statement usually takes a long time to arrive so the cardholder has time to come up with the money they owe. This is the interest free period, but interest is changed if the account is not cleared in that period. Debit Card A Debit Card is basically a cheque book and cheque card combined. At the point of purchase the money is debited from the customers bank account, after which a transaction voucher has to be signed by the customer so that company knows the right person has used the right card. Also so the company can keep a record of whom has shopped at their establishment. PC5 Importance of security It is very important that financial transactions are recorded clearly and accurately to protect them from theft, fraud and criminal damage . Security checks are there to prevent fraud, theft and to ensure high standards of honesty. By constantly checking records and by special equipment which can detect security checks. Authorisation of orders. When an order is sent to a supplier, the customer must be sure they can pay for it . Certain people will decide ?? ?? ?? ?? Element 4.1: Financial Transactions and documents. Identify and explain financial transactions and documents. ...read more.

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