An Invoice is a commercial document that indicates all kinds of selling activity. It is basically the bill that is issued by a seller to the buyer. It has all the details about the sales activity such as the details of products, the quantity purchased, prices for the product and any terms and conditions for the guarantee or warantee. When an invoice is given to another company, it means that you certainly ow them some money. There are also various types of invoices depending on their purpose and usage such as:
- Proforma Invoice
- Time Sheet
- Debit memo
- Credit memo.
The purpose of an invoice is to have a clear documentation of the services rendered and the expectation of payment. An invoice is preceded by a contract (verbal or otherwise) and indicates the services that were provided, rate of services, and total amount due. Invoices also include time expectation of payments, usually net 30 (30 days after receipt of invoice) or net 60 (60 days after receipt of invoice).
You can use anything to document an invoice, there's pre-made paper templates and online invoice tools. For freelancers and small businesses, invoices can be a nice extension of their branding and should be accurate and look professional.
An invoice is a statement of sold products or services. Sometimes before creating a regular invoice, proforma is created. You can prepare a proforma invoice for a client. If the client agrees for all items, prices, and total value, you can create the real invoice based on the proforma. A lot of invoice software provides such functionality.