Receipts, which are provided after payment for an item, document the details of a sale.
An invoice and a receipt are used in two totally different situations. An invoice is presented when money is due, while a receipt is given when an amount due has been paid. In other words, an invoice is a request for payment, while a receipt is the advice of payment received.
Accounts are generally used for purchases made on credit, and receipts follow cash payments for goods or services. For example, when a customer pays for a purchase, the clerk adds up the items and gives the customer a receipt immediately after receiving payment. A person who has an account with a telephone company, on the other hand, is likely to receive a bill at the same time of the month for the specific amount owed. If the previous month’s bill hasn’t been paid, the amount will usually be added to the current bill, perhaps with interest charged if the due date has passed a long time. This invoice and receipt method is used for both consumer and business situations.
Grocery store clerks hand out receipts to customers as they check out.
In the business world, a bill is generally known as an invoice. The net term of 30 days is commonly used in companies to indicate that the invoice must be paid in full within 30 days following the purchase of the good or service. An invoice and a receipt can be used in different transactions for a customer who has an account with a company. If the customer is making a larger purchase, you may want to use credit and be billed, but if it’s just for one or two items, it may be preferable to pay cash and keep the receipt as proof of payment.
An account is presented when money is owed.
Bills or invoices are typically prepared using computer software in office settings, while many receipts are created at store cash registers. Receipts can also be handwritten at the time of a cash payment, such as when a landlord receives monthly rent from a tenant. Unlike cash receipts or invoices, a handwritten receipt is not always itemized, but only includes the total amount. Bills and receipts that are itemized usually show the net amount first, then add taxes or subtract discounts before putting the total at the bottom. However, the totals on an invoice and a receipt will always mean different things.
Restaurant customers receive a bill to show how much they have to pay.
The total amounts on all types of receipts indicate the funds paid. The total amounts on each type of bill mean that the amount is still due, unless the bill is stamped “paid.” Instead of using a stamp or surcharge paid on a bill, most businesses today indicate on a separate statement, or on future bills, that the previous amount due has been received.