Invoices
Every
time you make a sale to a customer, you will
generate an invoice that describes all the
information regarding the sale: the date, what
was sold, the amount, any taxes, and payment
terms. If you run a retail business with a cash
register, your register tapes function as
invoices.
Becky
eyed
the stack
of
file
folders on
the corner of the desk. She had set up the
folders at the beginning of the year to hold all
the receipts and bank statements. Now it was
almost the end of the year, and Becky knew that
she would have to add them all up for the tax
returns.
You
will need at least two and probably three copies of
every invoice. The customer will get one for his or
her records (to enter it into his or her accounting
system) and you will need to keep one so that you
can record it in your accounting system. You may
choose to generate a third copy to keep in your
accounts receivable folder until paid. This way, you
will have one set of records ordered by date sale
was made (most useful for accounting purposes) and
one set of records ordered by date money was
received (most useful for tracking cash flow).
Statements of account
You
will undoubtedly have customers who owe you money at
the beginning of every month. It is a good idea to
send them a statement of account monthly so that
they can see how much they still owe you, how old
the invoice is, and the details of any payments that
have been applied to their accounts. A statement of
account is like a snapshot: a picture of all
transactions that have occurred to date with that
particular customer.
Purchase orders
You
mayor may not use purchase orders in your business.
When you order goods from a supplier, you may fill
out a purchase order first. This order would not
include prices but would show the quantities and
types of goods you ordered. You may also receive
purchase orders from your customers. If so, you
would keep these with your invoices, making sure
that what your customer ordered was what you
supplied.
Invoices,
Statements of Account and Purchase orders
