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Sales order and purchase order

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA MA – FIA FMA › Sales order and purchase order

  • This topic has 3 replies, 2 voices, and was last updated 4 years ago by John Moffat.
Viewing 4 posts - 1 through 4 (of 4 total)
  • Author
    Posts
  • October 9, 2020 at 12:33 pm #587815
    wavytrees
    Participant
    • Topics: 1
    • Replies: 1
    • ☆

    Hi there. I’m reading the FA1 booklet and am trying to understand this sentence:
    “In businesses selling to other businesses, the sales representatives (sales men and sales women) will be responsible for encouraging customers to place sales orders.”

    Why do B2B sales reps want to encourage customers to place sales orders, and not purchasing orders?

    October 9, 2020 at 3:53 pm #587831
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54665
    • ☆☆☆☆☆

    I will answer your question, but it should be in the Paper FA forum and not in the Paper MA forum 🙂

    Although the customer will call it a purchase order (because they are purchasing something), when we receive it we will call it a sales order (because we are selling something).

    We will have two files – one will be called ‘purchase orders’ and will contain all the purchase orders that we have sent to suppliers. The other will be called ‘sales orders’ and will contain all the purchase orders that our customers have sent to us.

    (I remember when I first joined an accountancy firm to train, and first went on an audit, I was very confused examining a file called ‘sales orders’ because all the orders in it had (obviously) been prepared by the customers and so had ‘purchase order’ typed at the top of each one 🙂 )

    October 13, 2020 at 10:26 am #588740
    wavytrees
    Participant
    • Topics: 1
    • Replies: 1
    • ☆

    Thank you John. I see the terms are flexibly used depending on the perspective of the side saying it. Your experience at the accountancy firm was funny to read 🙂

    October 13, 2020 at 1:44 pm #588761
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54665
    • ☆☆☆☆☆

    You are welcome 🙂

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Viewing 4 posts - 1 through 4 (of 4 total)
  • The topic ‘Sales order and purchase order’ is closed to new replies.

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