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An invoice is a commercial document issued by a seller to a buyer, indicating the products, quantities and agreed prices for products or services that the Seller has already provided the Buyer with. 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.

Variations

• 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.

• 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.

• 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).

• Invoices for hourly services work (such as by lawyers and consultants) often pull data from a timesheet.

• The term invoicing is also used to refer to the act of delivering the baggage to a flight company in the airport before taking the flight.

Electronic Invoices

With the popularisation of the internet, many invoices are not paper based anymore, but done electronically. 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.

What is on an Invoice?

A typical invoice contains:

• PO, invoice and internal order numbers
• DUNS or business tax ID number
• 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 of products, quantities and prices
• Shipping method and cost
• Total # of items and sum of amount due

Invoices samples

• Some free demo PDFs from a commercial package

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