Unit 2 - Area of Study 2: Accounting for and managing accounts receivable and accounts payable

Outcome 2

Record and report for accounts receivable and accounts payable, and analyse and discuss the effect of relevant decisions on the performance of the business including the influence of ethical considerations.

Examples of lear​ning activities

• Design appropriate source documents for a trading business.
• Examine the credit policy of a business and discuss any potential ethical issues that may arise as a consequence of providing credit to clients/customers.
• Record source documents provided in the accounts receivable and accounts payable records.
• Record transactions for accounts receivable and accounts payable in the appropriate journals and prepare the financial reports using ICT.
• 
  Calculate the accounts receivable turnover and the accounts payable turnover, and explain the results using data derived from a business scenario.
• Using data provided in a business scenario, model the potential outcomes of providing a discount to accounts receivable at several different rates. Provide a recommendation to the business owner based on the data obtained.
• Graph and analyse the accounts receivable turnover for a business over time. Provide reasons for any improvements and suggest strategies to improve the turnover.