C1 - section 8. Invoices. Flashcards
invoice definition
An invoice is a document that itemises a transaction between a buyer and seller. A sales invoice can be simply defined as the request for the buyer to make payment for goods sold or service provided by the seller.
When are sales invoices prepared?
The seller prepares and sends out an invoice after the goods have been delivered.
in manual systems, how are invoices prepared?
In manual systems invoices will be prepared from details on the delivery notes.
Delivery notes do not show prices, VAT or discounts, this is to prevent confusion between delivery notes and invoices.
on invoices, Price, VAT and discounts will need to be added.
in computerised systems, how are invoices prepared?
In computerised systems, invoices are prepared at the same time as delivery note and are identical apart from on the price, VAT, discounts are only shown on the invoice.
if the business is VAT registered, then the VAT registration number must be detailed on the sales invoice.
Where are prices of goods/services usually taken from?
Unit prices for goods/services are usually kept in a master file which must be updated regularly.
If incorrect prices are quoted, they will have to be honoured.
Prices quoted are exclusive of VAT as this is the true selling price of the business.
