POA Flash Card Worksheet

Fill in the blank: Net sales revenue = _______ - sales returns.

• Sales revenue

• Gross profit

• Operating expenses

• Cost of goods sold

The purpose of the Statement of Financial Position is:

• to show the financial performance of a business over a period of time.

• to present the financial position of a business at a specific point in time.

• to record all cash transactions of a business.

• to summarize the revenue and expenses of a business.

What causes the difference in the business Cash at bank and the bank statement?

• Due to difference in timing: 1. Business has recorded the transaction but bank has not. 2. Business has not recorded the transaction but bank has.

• Because the business always records more transactions than the bank.

• Due to errors in the business's inventory records.

• Because the bank statement is always prepared monthly.

If the balance brought down for Cash at Bank is a credit, what must be stated?

• It must be stated as a bank overdraft

• It must be stated as a cash surplus

• It must be stated as a bank deposit

• It must be stated as a petty cash balance

Purpose of statement of financial performance

• Provides a report on income, expenses and profit/loss over a period of time.

• Shows only the cash inflows and outflows for a business.

• Lists the assets and liabilities at a specific date.

• Summarizes the changes in equity during the year.

Fill in the blank: ________ informs credit supplier that payment by cheque has been made for a specific invoice.

• Remittance advice

• Credit note

• Debit note

• Purchase order

Fill in the blank: ________ informs credit customers of the amount owed after the business sold goods or provided services on credit.

• Invoice

• Receipt

• Voucher

• Cheque

Fill in the blank: ________ reduces amount owed by credit customers who were previously overcharged or after goods were returned.

• Credit note

• Debit note

• Invoice

• Receipt

Match the following business documents to their correct descriptions:

• Debit note

• Increases the amount owed by credit customers who were previously undercharged.

• Payment voucher

• Checks and tallies against the business records of its cash at bank account.

• Bank statement

• Processes payment to credit suppliers; must be approved by authorised personnel and must be supported by original supplier’s invoice.