I n t e r a c t I v e t e X t foundations in Accountancy/ acca financial accounting (ffa/FA) bpp learning Media is an acca approved Content Provider

PART C: THE USE OF DOUBLE-ENTRY AND ACCOUNTING SYSTEMS 

 

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(e) 

Details of trade discount, if any (eg 10% reduction in cost if buying over 100 pairs of shoes) 

(f) 

Total amount of the invoice including (usually) details any of sales tax 

(g) 

Sometimes, the date by which payment is due, and other terms of sale 

(h) 

Details of any cash, or settlement discount (eg 5% reduction of invoiced amount if paid within 10 

days), and the discounted amount 

1.2.2 Uses of invoices 

As stated above, invoices may be used for different purposes. 

 

Copy to customer as a request for payment 

 

Copy to accounts department to match to eventual payment 

 

Copy to warehouse to generate a despatch of goods, as evidenced by a goods despatched note 

 

Copy matched to sales order and kept in sales department as a record of sales 

1.3 The credit note 

Crockery Supplies sent out an invoice for 20 dinner plates, but the accounts assistant accidentally typed 

in a total of $162.10, instead of $62.10. The homeware shop has been overcharged by $100. What is 

Crockery Supplies to do? 

Alternatively, when the homeware shop received the plates it found that they had all been broken in the 

post and that it was going to send them back. Although the homeware shop has received an invoice for 

$62.10, it has no intention of paying it because the plates were useless. Again, what is Crockery 

Supplies to do? 

The answer is that Crockery Supplies sends out a credit note. A credit note is sometimes printed in red 

to distinguish it from an invoice. Otherwise, it will be made out in much the same way as an invoice, 

but with less detail and 'Credit Note Number' instead of 'Invoice Number'. 

A