Unit 4-The Accounting Cycle

What are source documents?InvoiceReceiptDeposit SlipCheck CounterfoilStatementPayment Confirmation

Why source documents?-The first documents that exist relating to a transaction-Serve as proof for a transaction, includes date and time(EQ)

Invoices-Normally relate to credit transactions-List goods or services provided and their prices-Suppliers normally send an invoice with goods (or once services have been delivered)-Indicate payment in terms (time)-"Bills"-Has due date, description, tax, to, terms (and other sorts of information)

Receipts-Confirm that services or goods have been received-Normally relate to cash transactionsCash transactions=receipts, credit transactions=invoices

Deposit Slip-Proof that cash has been deposited into a bank account-Coins and cash-Businesses sources documents for every transaction as proof

Check Counterfoil-Part of the check kept by the drawer (writer) of the check as a record of the transaction-Right hand side is ripped off as a receipt, A is the check counterfoil (the part the drawer keeps), and B is the receipt

Statement-A report showing the amount owed by one business to another-Details of transactions between the two businesses-Date, due dates, what happened with money, how much is owed, etc.

Payment Confirmation-Proof of Internet transactions

4-1 Source Docs