Learning Aim B - Financial Records

Question 1

Purchase order (define and number)

Answer 1

1 - completed by buyer, lists specific items required and the price

Question 2

Delivery note (define and number)

Answer 2

2 - completed by supplier, lists all items in the delivery

Question 3

Goods received note (definition and number)

Answer 3

3 - sent by buyer, confirmation they’ve received the goods

Question 4

Invoice (definition and number)

Answer 4

4 - completed by supplier, lists: goods delivered, money owed, date payment should be by

Question 5

Receipt (definition and number)

Answer 5

5 - completed by supplier, sent once goods are paid for

Question 6

Statement of account (definition and number)

Answer 6

6 - completed by supplier, sent once a month and is a summary of everything

Question 7

Problems if not keeping accurate financial documents

Answer 7

Lose track of how much is owed
Miscalculate profit or cash flow forecast

Question 8

What are the payment methods

Answer 8

Cash
Credit card
Debit card
Direct debit
Payment technologies

Question 9

Influences of choice of payment method

Answer 9

Convenience
Ability to pay
Technology
Safety and security
Costs

Question 10

Advantages of cash

Answer 10

No technology needed
Convenient for customers

Question 11

Disadvantages of cash

Answer 11

Money can be lost or stolen
Mistakes can be made during transaction

Question 12

Advantages of credit cards

Answer 12

Payment received immediately
Spend more money than you have

Question 13

Disadvantages of credit cards

Answer 13

High interest rates
Customers can’t spend above credit limit

Question 14

Advantages of direct debit

Answer 14

Easy to pay regular bills
Spreads cost over long time

Question 15

Disadvantages of direct debit

Answer 15

Must have sufficient funds to pay monthly

Question 16

Advantages of debit cards

Answer 16

Less mistakes made during transaction
Reduces needs to use cash

Question 17

Disadvantages of debit cards

Answer 17

Contactless may be fraudulent

Question 18

Advantages of payment technologies

Answer 18

Safe way to pay
Quick and efficient

Question 19

Disadvantages of payment technologies

Answer 19

Some payment technologies (e.g. PayPal) charge a fee
Risk of technology not working properly

Question 20

Two different costs

Answer 20

Variable costs
Fixed costs

Question 21

Fixed costs examples

Answer 21

Salaries
Rent
Insurance

Question 22

Variable costs examples

Answer 22

Stock
Raw materials
Packaging

Question 23

How do you improve gross profit

Answer 23

Increase price
Decrease cost of sales

Question 24

How do you improve net profit

Answer 24

Reduce expenses
Increase price