Question

Describe two source documents you would use to review a forecast against actual performance

Answer 1

Source documents are the original documents that gives the details of transactions entered by the business.

These documents also tells about the working pattern of the organisation.

The 2 source documents to review a forecast against actual performance are -

1) Sales order book - This documents provides the total sales made by the company during the period which can be compared with the total sales forecasted by the company . Also we can compare the geograhically divided sales to different locations to know our preferred location of sales.Company can also allocate resources efficiently based on it and can plan for future growth.

2) Expense report - The other part of revenue is expense, hence even this report plays a vital role as source documents while comparing the forecast with the actual performance as this keeps the track whether the company is incurring any unwanted expenses or is the company exceeding any amount of expense.This report also shows the bifurcation of the company total expense and hence the company can very well know about their spendings.