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Unit 4

Payment choices; Methods of keeping records; Changes over time and the impact of technology

“so how do you use a credit card again?”

Table of Contents

Please note a lot of this is basically the textbook.

Payment options


Legal tender that is issued by the government and must be accepted as payment for goods and services. Used to pay for inexpensive items (e.g food, drink)


Immediate supply of money that is paid back later. Buy immediately, pay later.

Credit cards have many advntages such as:

  • avoid carrying lots of cash
  • convenient for online/telephone payments
  • can be good for your credit rating and disadvantages such as:
  • easy to overspend and build up debt
  • more expensive than other forms of credit
  • can damage your credit rating


Debit cards are different to credit cards.

  • In credit cards, you use other people’s money and are charged interest.
  • In debit cards, you are using your own money and only pay account operating fees.

Using debit cards is most common with EFTPOS – electronic funds transfer at point of sale. EFTPOS is a computerised system to transfer money from a customer’s account to a business’s account.

EFTPOS machine


BPAY is another electronic payment method. Transaction details can be provided over the internet or using a telephone to transfer funds from a customer’s account to a business account.

Direct Debit

For bills and fixed expenses (as opposed to variable expenses), a payee can nominate a bank account to automatically deposit funds from a payees account to a business’s account.


A cheque is a written communication from an account holder (drawer) ordering a financial institution (drawee) to pay a person a specific amount of money (payee).



You pay in regular instalments as the store reserves a good for you, and then being able to secure the good once all of the payments have been made. Lay-by is interest free and can secure something you can pay over time for.


Jill, your relatives are really naughty pineapples.

Book-up is a charge account usually operated by a trader (such as a plumber or a builder. It allows someone to purchase goods and then pay for it later. No interest is charged and purchases can be spread out over 1-2 weeks, but security may be required and overspending is possible. Range is also limited to one store only.

Keeping records

Accurate and up-to-date records and receipts of purchases and payments, with information such as:

  • paid accounts
  • outstanding accounts
  • total expenses
  • cash balance
  • date, amount and item purchased

This is especially useful if there is a dispute regarding payment. With technology, spreadsheets and database programs such as Microsoft Excel, Google Sheets or LibreOffice Calc.

The humble spreadsheet

Spreadsheet that looks like it is runnning on Windows 3.1

Spreadsheets are series of rows and columns that can receive text and numerical input, and in some instances output the result of equations.

Individual boxes are known as cells. They are referred by their column letter and row number. If new data is inputted then totals (calculated using equations) will automatically update.

The muscular database

Database software

Databases are like spreadsheets on steroids. An end user can search through a large number of files to find specific information. Databases can be used for many purposes, such as account transactions, details of purchased goods and other financial records.

The impact of technology


Before money, there was barter – the swapping or exchanging of one good for another. It still exists in some parts of the world but has largely been replaced with money because calculating the value of items is difficult. Barter only works when there is a double coincidence of wants – when you have what someone else wants and vice versa.

Bartere has been replaced with money, and in the beginning special items were used such as gold, but now, paper notes and coins are used instead to represent something of value.

Electronic transfer of funds

Electronic transfer of funds is now possible with technology.

  • For purchases under $100, Visa payWave and MsaterCard PayPass allows a credit card to simply be tapped against a contactless terminal. Nowadays it is also integrated with EFTPOS machines.
  • Smartphone apps and websites such as NetBank, Apple Pay and GPay allow for payments using the smartphone.
  • Dial and pay allows you to call a number and pay for goods by having it automatically added to your monthly phone bill

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