MANAGEMENT

Detailed explanation-1: -This paper trail is referred to in accounting as source documents. Whether checks are written to be paid out, sales are made to generate receipts, billing invoices are sent by suppliers, or work hours are recorded on an employee’s timesheet – all the respective documents are source documents.

Detailed explanation-2: -An invoice is a source document that shows all details of the sale, including payment terms. These details are entered as a sales invoice by the seller, and a purchase invoice by the buyer.

Detailed explanation-3: -Examples of source documents are cancelled checks, credit memos, deposit slips, expense reports, invoices, material requisition forms, purchase orders, time cards, and sales receipts.

Detailed explanation-4: -In the accounting industry, source documents include receipts, bills, invoices, statements, checks – i.e., anything that documents a transaction. Any time a business spends or receives money, a source document is created.

Detailed explanation-5: -Each time a company makes a financial transaction, it generates some paper trail. Accountants call this paper trail a source document or documents. If a small business writes a check from its checking account for office supplies, for example, the check and office supplies receipt become the source documents.