The main difference between invoice and receipt is that the invoice issued before the payment and the receipt issued after the payment.
Invoice vs. Receipt
An invoice is a request for amount while a receipt as proof of amount. Customers who get an invoice will also get a receipt when they pay. Invoice is issued before the payment, on the other hand, the receipt issued after the payment. The invoice is used to record the sale of goods or services, but receipt acts as a memorandum for the buyer that the amount of the commodity has paid. The invoice illustrates the total amount due whereas the receipt indicates the total sum paid along with the mode of payment. So, if you are a dealer, you would send an invoice after a utility has completed, and money is payable, and then you would send a receipt after you receive the payment for the invoice.
What is an Invoice?
Invoices are statements sent to customers after they have received a good or service. An invoice is a document that details the transaction. Businesses that give goods or services to the purchaser before receiving payment send invoices includes information like the date the invoice made, invoice payment terms, and the total amount due. They are important for speeding up the cash stream, making sure you get paid and keeping financial records for your business. The essential thing to note about the invoice is that it is a legally enforceable document. However, an invoice isn’t just about seeking payment. It also lists out many pertinent details such as the names of the vendor and customer, the address, phone number, email address and fax number of the vendor, the services or goods transacted, the quantities, the prices, the date the invoice issued, the invoice number and the total payment to be made. An invoice is an acknowledgment issued by the vendor to the customer of goods or services to demand the payment of goods sold or services performed by him. It is a non-variable legal document which identifies the buyer and seller of the stuff. The instrument delivered before the payment of the goods for indicating the amount due to the merchandise. An invoice is a detailed record of products sold or services provided, onward with the amount of money payable for each line item, and the total amount of money owed. An invoice is sent from the seller to the client, in hopes of being paid within a certain amount of time.
What is a Receipt?
A receipt acts as evidence of a transaction. You give customers receipts later they have paid for a product or service. They also provide information on the payment mechanism, how much paid, and details about the vendor. A receipt is a record acknowledging that a person has received money or property in payment following a sale or other transfer of products or supplies of a service. All receipts must include the date of purchase on them. In most cases, the receiver of money provides the receipt, but in some cases, the receipt is produced by the payer, as in the case of goods returned for a refund. Since the receipt display products and prices, you can verify the customer purchased the item(s) from your business. For the most part, you should give purchasers a receipt for each transaction. It also acts as proof of ownership in the case of transaction of products. It lists numerous bits of information such as the seller and buyer names, amount, taxes, discounts, the status of the payment, date of payment, receipt number, dealer’s signature and total amount payable. The receipt does not always estate what the payment has been made for and in what amount. That’s why an invoice becomes essential – to list out the item or service that was the subject of the transaction. A receipt is a commercial legal tool used for stating that some products or services of value have received. It is issued by the dealer to the purchaser to act as proof that payment has made. There is mostly no set form for a receipt, such as a requirement that it be machine generated.
- An invoice requests that a payment made and a receipt is a proof that a payment has made.
- An invoice issued before the payment made. A receipt issued after the payment.
- The invoice record the total amount that is outstanding or has to pay. The receipt, on the other hand, specifies how much has paid and what the mode of payment is.
- If a seller issues an invoice and the payment hasn’t yet made, the seller will place the payment as a Credit to vending and a Debit under Accounts Receivable.
- An invoice goes to the purchaser who has to make the payment while a receipt may go either to the customer or a third party as evidence of payment.
- An invoice is used to remain track of products or services sold. A receipt, on the other hand, accept that a payment has made.
- Total amount due is indicated in an invoice while the total amount paid is on a receipt.
- An invoice serves to monitor product sales while a receipt serves as evidence or documentation for the buyer for the amount that has purchased of product.
Sales invoice and formal receipt both are an important part of the purchase cycle. The invoice helps the vendor to keep the record of sale and to determine that amount of products has received or not. The purchaser can also track and match the details of the products or services record on the invoice are received. The receipt can help the buyers to track payments for the stuff and sellers can also identify that amount on which invoices received and which ones are still outstanding.