Discuss the four business functions that result in sales transactions in a typical sales and collection cycle and, for each function, state the key documents and records involved.

Discuss the four business functions that result in sales transactions in a typical sales and collection cycle and, for each function, state the key documents and records involved.



Answer:

The four business functions that result in sales transactions, and related documents and records, are:

Processing customer orders. Key documents include customer order and sales order.
Granting credit. Customer order or sales order.
Shipping goods. Shipping document (bill of lading).
Billing customers and recording sales. Sales invoice, sales journal, summary sales report, accounts receivable master file, accounts receivable trial balance, and monthly statements.

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