Invoice
From Wikipedia, the free encyclopedia
An invoice is a commercial document issued by a seller to a buyer, indicating the products, quantities and agreed prices for products or services with which the seller has already provided the buyer. An invoice indicates that, unless paid in advance, payment is due by the buyer to the seller, according to the agreed terms. Invoices are often called bills.
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[edit] Variations
There are many different types of invoices:
- Credit Memo - If the buyer returns the product, the seller usually issues a credit memo for the same or lower amount than the invoice, and then refunds the money to the buyer or the buyer can apply that credit memo to another invoice.
- Debit Memo - When a company fails to pay or short-pays an invoice, it is common practice to issue a debit memo for the balance and any late fees owed. In function debit memos are identical to invoices.
- Self Billing Invoice - A self billing invoice is when the buyer issues the invoice to himself (e.g. according to the consumption levels he is taking out of a vendor managed inventory stock).
- Timesheet - Invoices for hourly services work (such as by lawyers and consultants) often pull data from a timesheet.
- Invoicing - The term invoicing is also used to refer to the act of delivering baggage to a flight company in an airport before taking a flight.
[edit] Europe
An invoice, called a commercial invoice is a key document for transporting product across many national borders.
It is not needed for transport of documents within the European Economic Area.
[edit] Electronic Invoices
With the popularization of the internet, many invoices are no longer paper based, but done electronically. It is still common for electronic remittance or invoicing to be printed in order to maintain paper records. The regulation on how to do electronic invoicing varies widely from country to country. B2B standards have created messages and implementation guidelines for electronic invoices. See for example EDIFACT or RosettaNet.
[edit] What is on an Invoice?
A typical invoice contains:
- Purchase order (PO), invoice and/or internal order numbers
- Tax ID number and/or Data Universal Numbering System (DUNS)
- Entry, Shipped, order and invoice dates
- Billing or "sold to", shipping, and "remit to" addresses
- Terms of payment including due date, discount due date and discount amount
- Line-item list for each item, one per row, with columns showing: quantity, unit of measure, unit cost, product description, sub-total line cost, tax, total line cost, and item notes.
- Shipping method and cost
- Sum of each column, showing total number of items, raw sub-total, sub-total tax, and total amount due
