POA chapter 2

• what is an accounting information system?

  accounting information system is a system at stores, process and collects accounting data
• what are the 2 business transactions?

  cash transaction and credit transaction
• what is cash transaction?

  payment is made at the same time or immediately during a cash sale or purchase
• what is credit transaction?

  payment is delayed or postponed during a credit sale or purchase
• what are the 7 source documents?

  receipt, remittance advice, invoice, credit note, debit note, payment voucher, bank statement
• what is the purpose of receipt?

  acknowledges payment received from customers immediately after the business ahs sold goods or provided services
• what is the purpose of remittance advice?

  informs credit supplier that payment by cheque has been made for a specific invoice
• what is the purpose of invoice?

  informs credit customer the amount owed after credit sale
• what is the purpose of credit note?

  decrease amount owed by credit customers
• what is the purpose of debit note?

  increase the amount owed by credit customers
• purpose of payment voucher?

  used to process payment to credit suppliers
• what is the purpose of bank statement?

  checks and tallies against the business record of its bash at bank account