Question

Please help me with question 1.2

QUESTION 1 28 marks Precious Beauty Products (Pty) Ltd buys inventory (cosmetic products) and then sells the products to various chain stores at a profit. PART A: FUNCTIONS AND ACTIVITIES There are various functions and activities within each function of the accounting system for the various cycles. REQUIRED Marks 1.1 List the seven main functions in the accounting system for credit sales and receipt transactions with a brief description of each function. (15) 1.2 (13) List the five functions in the accounting system for credit purchase and payment cycle with a brief description of each function.

Answer 1

Identification- This is one of an accounting system function that helps in identifying transactions related to the credit purchase and the payment cycle for clarifying the transactions in the business.

Recording- In this function, identified heads of the transactions are recorded in the journal entry to treat all the accounts in a specific period.

Classifications- After posting to the journal entries, the account of balances is classified into required heads using two major classifications such as credit purchase and payment cycle.

Summary- In this, the records are summarized into specific forms to come to a specific conclusion by knowing the adjusted balances.

Determination- In the final stage o the accounting function, the favorable or non-favorable results ascertained by an entity