We present spectrophotometric ISO imaging with the LWS and the CAM-CVF of the Serpens molecular cloud core. The LWS map is centred on the far infrared and submillimetre source FIRS1/SMM1 and its size is 8'x8'. The fine structure line emission in [OI]63µm and [CII]157µm is extended on the arcminute scale and can be successfully modelled to originate in a PDR with G0=15±10 and n(H2) in the range of (104-105)cm–3. Extended emission might also be observed in the rotational line emission of H2O and high-J CO. However, lack of sufficient angular resolution prevents us from excluding the possibility that the emssion regions of these lines are point like, which could be linked to the embedded objects SMM9/S68 and SMM4. Toward the Class0 source SMM1, the LWS observations reveal, in addition to fine structure line emission, a rich spectrum of molecular lines, superposed onto a strong, optically thick dust continuum (Larsson et al., 2000). The sub-thermally excited and optically thick CO, H2O and OH lines are tracing an about 103AU source with temperatures higher than 300K and densities above 106cm–3 (M=0.01M☉). The molecular abundances, X=N(mol)/N(H2), are X=(1,0.1,0.02,≥0.025)x10–4 for CO, H2O, OH and 13CO, respectively. Our data are consistent with an ortho-to-para ratio of 3 for H2O. OH appears highly overabundant, which we tentatively ascribe to an enhanced (X-ray) ionisation rate in the Serpens cloud core (ζ≫10–18s–1). We show that geometry is of concern for the correct interpretation of the data and based on 2D-radiative transfer modelling of the disk/torus around SMM1, which successfully reproduces the entire observed SED and the observed line profiles of low-to-mid-J CO isotopomers, we can exclude the disk to be the source of the LWS-molecular line emission. The same conclusion applies to models of dynamical collapse (``inside-out'' infall). The 6'' pixel resolution of the CAM-CVF permits us to see that the region of rotational H2 emission is offset from SMM1 by 30'', at position angle 340°, which is along the known jet flow from the Class0 object. This H2 gas is extinguished by AV=4.5mag and at a temperature of 103K, which suggests that the heating of the gas is achieved through relatively slow shocks. Although we are not able to establish any firm conclusion regarding the detailed nature of the shock waves, our observations of the molecular line emission from SMM1 are to a limited extent explainable in terms of an admixture of J-shocks and of C-shocks, the latter with speeds of about (15-20)km/s, whereas dynamical infall is not directly revealed by our data.