1. Making, receiving and recording payments made to or from a business Welsh translation of above

2. Learning Objecives  Understand the purpose of different methods of payments  Complete financial records to record incoming and outgoing cash  Be able to record payments made and received  Be able to analyse payments made and received, allowing for VAT

3. Methods of Payment  Cash  Cheque  Debit Cards  Credit Card  BACS

4. Which Methods are the most popular? A) Cash B) Cheque C) Debit Cards D) Credit Card E) BACS Cash Cheque BACS Credit Cards Debit Cards

5. Cheques What’s on a cheque? What’s on a cheque  Usually takes 3 working days for a cheque to clear  Is a paper based form of payment  “promise to pay”  Cheques must be presented to a bank to obtain payment

6. Debit Cards  A plastic card, issued by the bank which allows payments to be made without writing a cheque or carrying cash. Customer hands over debit cart Seller puts card in chip and pin machine The bank electronically takes from customer account and adds to business account (3 days)

7. Credit Cards  Just like a Debit Card BUT  You are borrowing the money (it does not come out of your account)  You get a statement at the end of each month  You have to pay some off each month  You have to pay interest on the balance

8. BACS Banks Automated Clearing System  Credit Transfers Used for large transfers on money, usually wages  Direct Debits The business can request payment for different amounts e.g. utility bills  Standing Orders Customer instructs bank to make regular payments to business It is a way of transferring money between accounts without exchanging cash or cards

9. The main advantage of using cash for payments A) Ideal for small purchases B) Better for large amounts C) Can be used for mail order or online D) Customers don’t have to remember payment dates E) Enables the cardholder to borrow money A) Ideal for small purchases

10. The main advantage of using cheques for payments A) Ideal for small purchases B) Better for large amounts C) Can be used for mail order or online D) Customers don’t have to remember payment dates E) Enables the cardholder to borrow money Better for large amounts

11. The main advantage of BACS for payments A) Ideal for small purchases B) Better for large amounts C) Can be used for mail order or online D) Customers don’t have to remember payment dates E) Enables the cardholder to borrow money Customers don’t have to remember payment dates

12. The main advantage of Debit Cards for payments A) Ideal for small purchases B) Better for large amounts C) Can be used for mail order or online D) Customers don’t have to remember payment dates E) Enables the cardholder to borrow money A) Can be used for mail order or online

13. The main advantage of Credit Cards for payments A) Ideal for small purchases B) Better for large amounts C) Can be used for mail order or online D) Customers don’t have to remember payment dates E) Enables the cardholder to borrow money  Enables the cardholder to borrow money

14. What is the main disadvantage of using Credit cards? A) has to be counted B) Takes time to clear C) High interests so expensive way to borrow D) Customers may fail to check price changes and fail to budget. E) Danger of fraud High interests so expensive way to borrow

15. What is the main disadvantage of using Cash? A) has to be counted B) Takes time to clear C) High interests so expensive way to borrow D) Customers may fail to check price changes and fail to budget. E) Danger of fraud It has to be counted

16. What is the main disadvantage of using Cheques? A) has to be counted B) Takes time to clear C) High interests so expensive way to borrow D) Customers may fail to check price changes and fail to budget. E) Danger of fraud Takes time to clear

17. What is the main disadvantage of using Debit Cards? A) has to be counted B) Takes time to clear C) High interests so expensive way to borrow D) Customers may fail to check price changes and fail to budget. E) Danger of fraud There is a danger of fraud

18. What is the main disadvantage of using BACS? A) has to be counted B) Takes time to clear C) High interests so expensive way to borrow D) Customers may fail to check price changes and fail to budget. E) Danger of fraud Customers may fail to check price changes and fail to budget

19. Cash why use it why not use it?  Payment is made immediately  Ideal for small purchases  Convenient  Cash has to be counted  Has to be locked away for security  Can be stolen

20. Cheques why use them why not use them?  Safer than cash  Better for large amounts  Takes time to clear  It can bounce  Errors can result in completion and non payment by bank

21. Debit Cards why use them why not use them?  Guaranteed payment  Can be used for mail order or online  Takes 3 days for money to be received  A fee must be paid to the bank  Danger of fraud – hence chip and pin

22. Credit Cards why use them why not use them?  Guaranteed payment  Can be used for mail order or online  Enables the cardholder to borrow money  Takes 3 days for money to be received  A fee must be paid to the bank  High interests so expensive way to borrow

23. Credit Transfers why use them why not use them?  Fewer security problems – no cash  Records kept through bank statements  Quicker than writing lots of cheques  The bank needs notice before releasing wages  They need checking as errors cost money

24. Direct Debit why use them why not use them?  Guaranteed payment  Customers don’t have to remember payment dates  Businesses can change amount and payment date  Money is still taken even if there is no money in customers account  Customers may fail to check price changes and fail to budget.

25. Standing Orders why use them why not use them?  Customers don’t have to remember payment dates  Customers don’t have to write out cheques  Money is still taken even if there is no money in customers account  Customers may fail stop standing order and go on paying for services they are not receiving.

26. Cash Books – Payments made by business