Introduction to Business Documents

Business documents are used to keep records of all transactions

They are used as sources of information

• The amounts are then entered into the books of prime entry

• They can be used to check potential errors

Invoices

Debit notes

Credit notes

Statements of account

Cheques 

Cheque counterfoils

Receipts

Paying-in slips

Bank statements

Petty cash vouchers

A trade discount is a reduction in the selling price of goods or services

Trade discount might be offered

• If the customer buys in bulk

• If the customer is a loyal and regular customer

Trade discount is applied before a transaction takes place

The discounted amount is the value that is entered into the books of prime entry

• The value of the trade discount is not entered into the books of prime entry

• Trade discount is not part of the double entry system

A cash discount is offered to credit customers for early repayment of an invoice

The supplier will state the deadline for payment in order to claim the cash discount

The amount before the cash discount is entered into the books of prime entry

When the customer pays early and claims the cash discount

• The amount of cash discount is recorded in the books of prime entry