CASH AND CREDIT INVOICES - Wamark

CASH AND CREDIT INVOICES1. Sales QuoteA sales quote allows a prospective buyer to see the costs thatwill be involved for a desired service/product.A sales quote can be used as a negotiation tool to comparepricing, Terms of payment, delivery time etc.Quotes can be used to follow up on potential sales.2. InvoiceOnce a quote has been accepted, an invoice is generated.Invoice details include:Both parties' information, date, quantities, price, discounts,VAT Number (If registered) as well as payment terms.KEYWORDS2. 1 Cash Invoice (Payment before or on delivery) Send Proof of paymentCash on deliveryDeposit required, balance on deliveryFull settlement before goods are delivered or servicerendered2.2 Credit Invoice (Grade 9)The difference between a cash and credit invoice is that with acredit invoice, payment is deferred i.e. The service or goods aredelivered before payment. Terms of payment is negotiated andpayment is made over a period of time.Buy goods or service on credit - The seller is your Creditor (Liability)Sell goods or service on credit - The buyer is your Debtor (Asset)

3.1 Manually Generated Cash Invoice using a duplicate invoicebook. A quote can double up as an invoice as the details are thesame except for the wording. ( Quotes don't usually include thebanking details of the supplier)The original invoice (top copy) is issued to the clientsInvoice numbers of an invoice book are in chronological orderTemplate of an qoute/invoice.Carbon paperExampleBaBanking Details.

3.2 Manually generated cash invoices using computer programse.g. Microsoft Word and Excel.A disadvantage of manually generating an invoice is that it istime consuming and prone to human error especially whencalculating prices, VAT and discounts.Invoices need to be printed and filed (Back up)as they arenot stored on-line.Example

3.3 Automated cash invoices generated using an On - lineAccounting System e.g. Quickbooks, Sage, FreshbooksExample of a quote being converted to an invoice4. Recording Cash Receipts and Cash Payments4.1. A Cash invoice is issued for Sales/Current Income/Rent Income etc.Proof of payment received on a Cash Invoice is called the Source document.Source documents to prove Cash Receipts include: Duplicate Receipt,Duplicate Cash Register Roll, EFT (Bank Statement)Cash Receipts are recorded in the Cash Receipts Journal (CRJ)4.2. A Cash Invoice is received for Expenses /Assets etc.Proof of payment made on a Cash Invoice is called the Source DocumentSource documents to prove a Cash Payments include: Cheque counterfoil,Original Receipt, Original Cash Register Roll, EFT (Bank Statement)Cash Payments are recorded in the Cash Payments Journal (CPJ)

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3.3 Automated cash invoices generated using an On - line Accounting System e.g. Quickbooks, Sage, Freshbooks 4.Recording Cash Receipts and Cash Payments 4.1. A Cash invoice is issued for Sales/Current Income/Rent Income etc. Proof of payment received on a Cash Invoice is called the Source document.File Size: 4MB