An invoice is a commercial document issued by a seller to a buyer, relating to the sale of a product or service. The invoice typically indicates the quantity and price of the goods or services sold, discounts, rebates, taxes, and other charges.
Invoicing is an important part of any business transaction as it provides both parties with a record of what was purchased, when it was purchased, and how much was paid. This can be helpful in the event that there is ever a dispute about what was agreed upon.
There are many different ways to generate invoices. Some businesses use accounting software that automatically creates invoices based on sales data entered into the system. Others create invoices manually using paper or Excel spreadsheets. No matter which method you use, there are certain elements that should always be included on an invoice:
1) Company name and logo - This helps customers identify who they need to pay. Include your company slogan or tagline if you have one.
2) Invoice number - Assign each invoice a unique number so you can keep track of them (this will come in handy if you ever need to refer to this particular invoice). You might also want to include the date on which the invoice was issued.
3) Customer information - Include the customer's name, address, and contact information so they know where to send payment. If you're sending an electronic invoice (more on that below), you can also include links for customers to easily make payments online.
4) Itemized list of products or services - Be clear and concise in describing what exactly the customer is being charged for. If there are multiple items being billed at different prices, make sure to list each one separately rather than bundling everything together under one line item (e.g., Website design vs Designing homepage + 5 internal pages). You should also include any relevant details such as SKUs or product codes, quantities sold/provided, unit prices, etc.
5) Subtotal - After listing out all of the products/services being charged for, calculate the subtotal (i.e., total cost before taxes and other fees).
6) Taxes - If applicable, add in any relevant taxes such as state sales tax or VAT tax . Be sure to clearly indicate what these charges are for so there are no surprises for your customer when they receive their bill .
7) Discounts