Which document is used before preparing a purchase order?

Which document is used before preparing a purchase order?

• A. Purchase order
• B. Order guide
• C. Delivery receipt
• D. Receiving report

Answer: (B)

An order guide is used before preparing a purchase order. It lists the items you routinely stock, the standard quantities (par levels) you aim to keep, and often preferred vendors or sizes, turning inventory needs into a concrete plan. This guide provides the exact items and amounts to order, which then becomes the basis for issuing a purchase order to the supplier. The purchase order itself is the formal request sent to the supplier, created from the information in the order guide. Delivery receipts occur after goods arrive and document what was delivered, while receiving reports are used at reception to verify received items against the PO and invoice.

An order guide is used before preparing a purchase order. It lists the items you routinely stock, the standard quantities (par levels) you aim to keep, and often preferred vendors or sizes, turning inventory needs into a concrete plan. This guide provides the exact items and amounts to order, which then becomes the basis for issuing a purchase order to the supplier. The purchase order itself is the formal request sent to the supplier, created from the information in the order guide. Delivery receipts occur after goods arrive and document what was delivered, while receiving reports are used at reception to verify received items against the PO and invoice.