An invoice, also referred to as a bill, is an officially file that details a financial transaction between a vendor and a customer.The invoice specifies the items or services given, quantities, charges, and total amount due. It acts as a record of the sale and a payment request.
Download Invoice Template in Excel & Word
Now that you understand the importance of invoices and how they work, get your free invoice template now! Choose from a number of templates customized for your specific business needs. You can also choose between formats such as Word (Docs) and Excel (Xlsx).
Why Is an Invoice Important for Your Business?
Invoices are essential to any business. Here’s why:
- Ensures timely payments: Clear and professional invoices help you get paid faster by removing doubt about what you owe.
- Accurate Record Keeping: Invoices are a written record of your sales and income for accounting and tax purposes.
- Professional image: Sending well-designed invoices presents a professional picture to your clients.
- Legal Documentation: Invoices can be used as legal documents in disputes over payment or services delivered.
What Is An Invoice Template?
An invoice template is a pre-formatted document that provides a foundation for creating your invoices. It typically includes essential elements like:
- Your business information (name, logo, contact details)
- Client information (name, address)
- Invoice number and date
- Description of goods or services provided
- Quantities and unit prices
- Subtotals, taxes (if applicable)
- Total amount due
- Payment terms (due date, payment methods)
How to Create an Invoice?
While you can make invoices with an online invoice generator, use of a template saves time and ensures you don’t forget any important details. Here’s a basic steps:
- Download a free invoice template that meets your needs.
- Open the template in your preferred software (for example, Microsoft Word, Google Docs, or Excel).
- Fill up your company information and client details.
- Describe the items or services offered, including quantity and pricing.
- Subtotals, taxes (if applicable), and the total amount payable should all be calculated.
- Specify payment terms (due date, payment methods).
- Save and send the invoice to your client.
What is the difference between a bill and an invoice?
The terms “invoice” and “bill” are sometimes used interchangeably. However, a small difference occurs. A seller normally issues an invoice to a buyer once the sale is completed. In contrast, a bill can be issued before or after a transaction, and it may include additional information such as penalties for late payments.
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