What is an invoice?
An invoice is a commercial document generated by the seller that lists items sold or services provided and their quantity and total sum due for the same. It is an essential accounting item as it helps both buyer and seller keep track of the amount owed and the amount paid.
Why do we need an invoice?
You need an invoice because:
- It is official proof that a transaction involving the sales of a service or item has taken place. It specifies what, when, to whom, and in what quantity the item was sold.
- Helps you keep track of payments by allowing you to set the terms of payment. You can send out payment reminders if the invoice states that a payment amount is outstanding from the buyers.
- An invoice, when raised, will leave behind a record of the transaction.
- Helps you analyse business trends with the data provided. You can easily find out buying trends, top-selling products, etc., helping your business flourish.
- Invoices are a priceless resource for accounting. They help you keep track of payments and dues, thereby making the tax filing process much easier.
Elements of an invoice
An invoice should be drawn with the following to be considered legally legitimate.
- The word “invoice” should be prominent with a unique invoice number to differentiate it from the bunch followed by the date on which you raised the invoice.
- The due date and the payment terms should be specified on the document.
- The seller’s name and address should be provided so that customers may reach out in case of any queries.
- The name of the customer, along with the billing address and shipping address.
- The details of the items sold, such as:
- The name of the item or service.
- The quantity which was requested by the buyers.
- The rate per unit of the item.
- The amount for the total number of units bought.
- The subtotal.
- Tax levied on the items.
- The total invoice amount.
- The balance due.
- The terms & conditions and authorised signatures.
Points to keep in mind while creating an invoice
- It should be aesthetically pleasing. You should use the colours in a way that highlights all the important parts naturally.
- Be very clear in terms of description. Avoid hidden charges as those can put a customer off.
- Give your clients a consolidated amount of how much they owe you for saving their time.
- Include incentives on early payments and seasonal promotions/offers in your invoice to ensure that your customer pays you on time.
- Offer multiple payment options. It ensures timely payment.
Advantages of invoicing software
Although we’re highly evolved beings capable of juggling multiple tasks, mistakes are bound to happen from time to time. After all, “to err is human.” While manual tasks often include errors, you can avoid them by using online invoicing software.
If you switch to myBillBook, our free accounting invoicing application, it will help reduce the chances of faulty data entry. An accurate record of transactions will increase operational efficiency, ensuring a rise in profits in the long run.
- Saves valuable time and effort during the billing process, which otherwise is a huge setback when you’re making an invoice manually.
- Looks out for and eliminates human errors by keeping the software design simple and easy to understand. It gives you accurate numbers as long as the basic input from your part is correct.
- Is accessible from a desktop app and a mobile phone so that the absence of either one can’t keep you away from your work.
- Allows you to share the billing invoice over various networks, like emails and WhatsApp.
- Keep track of accounts payable and accounts receivable with regular notifications by the software.
Why use myBillBook for your accounting invoicing needs?
A software like myBillBook allows retailers to bill faster and produce various invoices much more efficiently than creating manual bills and invoice while also keeping data accuracy in check. What’s more, myBillBook invoicing software lets you access all your data through the web at any given time that you need it, for no extra charge.
- myBillBook Android billing app can create GST and non-GST inclusive invoices (as per your preference) within seconds.
- It projects a professional and sophisticated image with professional-grade paper bills.
- You get regular notifications on the status of payables and receivables using our free accounting invoicing app,
- It provides 24×7 access to sale and purchase orders and allows you to monitor them till they’re delivered/received by relevant parties.
- myBillBook paid invoice app helps you save warehouse space by assessing the demand for the various stocks so that you can make purchasing decisions accordingly.
- You receive 10+ exclusive reports that ensure smooth functioning of the business, like:
- Sales summary
- Profit and loss reports
- Party statements
- Stock summary
- GSTR-1 (Sales) [paid feature]
- GSTR-2 (Purchase) [paid feature]
- GSTR-3B [paid feature]
- Protect your data with daily automated backup and sync your mobile app with your desktop software. This way, you can access all your records on the go through your mobile phone.
- Create purchase vouchers, payment receipts, quotations (estimates/sale orders), purchase orders, sale returns, purchase returns, delivery challans, and expense vouchers from your mobiles.
- You can upload a full inventory of the stocks by transferring items from other accounting apps or with the use of excel sheets and images.
- As an additional feature myBillBook has a feature for automated purchase orders. So, whenever a particular stock is about to reach its lower limit, myBillBook places an order to maintain the inventory.
We hope now you can see how myBillBook can transform your business operations for the better!