Making payments to suppliers – lesson 3

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Making payments to suppliers is a key part of the CONTROL ACCOUNTS, JOURNALS and the BANKING SYSTEM course.

You are part way through the CONTROL ACCOUNTS, JOURNALS and the BANKING SYSTEM course  and you should have read the pages listed below before reading this page:

 

Welcome to Making Payments to Suppliers.

It is important as an Accountant or Bookkeeper that you understand the practicalities of making payments to suppliers . You need to be aware of the different ways of making payments a business can undertake:
-Cash
-Cheques
-BACS transfers

Making Payments by Cheque
Payments by Cheque

The Accounting Trainee should know what checks to undertake to ensure that the right amount of money is paid and to the right person.

The Accounting Trainee should know the companies internal procedures for making payments to suppliers, the procedures for one-off payments by cheque on capital expenditure.

How regular monthly payments for insurance and energy payments  through standing orders and direct debits are made.

Another important aspect of making payments is the payments of wages by variable BACS direct credit systems.

Handling and making payments with cash is another important aspect of the Accounting Trainees job, as cash is often a target for theft!

Accounting trainee examiners will expect you to:
-know what a cheque requisition form is
-know what a bank giro credit is
-know what is meant by AUDDIS
-know what is meant by CHAPS
-the differences between the drawer and payee of a cheque
-differences between a debit card and a credit card
-understand what is meant by a dishonoured cheque
-define and prepare cheques and paying-in slips
-define a bank draft
-know what is meant by EFTPOS

The link to Amazon for the recommended reading on  Making Payments to suppliers is:

Now let’s test your knowledge of making payments to suppliers- go to the test below.
QUIZ: MAKING PAYMENTS to SUPPLIERS





Before attempting this quiz you should have read chapter 2 entitled 'making payments' of your recommended textbook “Bookkeeping 2".

Please attempt all questions and then press the submit button at the end, you will then be taken to your results page.

Good luck!



Name


1
A regular BACS payments, set up with the bank by the customer paying the amounts is called a .......................... order.



2
A regular and variable BACS payments, set up by the organisation receiving the payments is called a



3
A high value, same day, payments sent through the banks’ computer systems is called .........


4
A cheque written out by a bank – as good as cash – used for high value purchases is called a bank ............



5
A document sent by the buyer to the supplier to adviser the details of payment being made is called a ......................... advice.



6
An internal form which is completed and authorised when a cheque needs to be issued, normally for a ‘one-off’ payment is called a cheque ....................



7
An Automated Direct Debit Instruction Service allows the customer to authorise a direct debit by telephone or online and the beneficiary to send those instructions electronically to the payer’s bank. This system is often abbreviated to:



8
The letters CHAPS stand for - Clearing House ................ Payments System



9
Would you accept a cheque written in pencil?


10
Businesses often pay suppliers at the month end, they pay on receipt of ................... rather than in response to individual invoices.










Leaderboard for making payments

1. Kai G-30 Points
2. Amber-27 Points
3. Mongolian-27 Points
4. -27 Points
5. -27 Points

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