Theory question 101
Source Documents(a) Outline two differences between bookkeeping and accounting.
(b) List one source document used for each of the following transactions: (i) sales; (ii) purchases; (iii) cash deposit; (iv) salary; (v) returns outwards.
(c) State three purposes of source documents.
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(a) Any two: bookkeeping is the recording of transactions; accounting also classifies, summarises, interprets and communicates them. Bookkeeping is routine clerical work; accounting needs professional judgement. Bookkeeping records feed into accounting, which prepares financial statements for decisions.
(b) (i) Sales: sales invoice (or cash receipt/sales docket). (ii) Purchases: purchase invoice. (iii) Cash deposit: bank paying-in (deposit) slip. (iv) Salary: payroll/pay slip or payment voucher. (v) Returns outwards: debit note (or credit note received).
(c) Any three: evidence that a transaction took place; source of entries in the books of original entry; basis for checking and audit; reference for settling disputes; help prevent fraud; support for tax records.
Contrast recording with the wider accounting process, then name the matching documents.