An invoice and a bill are the two sides of the same coin. They hold the same purpose but belong to two different parties. If you are a business entrepreneur you would be well aware of these terms. But newcomers might not. Invoice and bill documents the same information related to a business transaction.
Here in this article, we have stated the basic difference between an invoice and a bill with a proper example for a better understanding. Keep reading to learn more about this!
What is an Invoice?
An invoice is a vital accounting document that covers every detail of a business transaction. This is issued from the seller’s point for their clients. Moreover, this is a significant document that tracks down the financial record of every business transaction. On a detailed note, the invoice accumulates the below data:
- An invoice consists of business records of goods or services provided to the client.
- It also states the payment details mentioning the amount of the goods or services provided.
- Besides, it also specifies the payment deadline with payment mode.
What is a Bill?
Bill is also an accounting document but from the customer’s end. This outlines the business details of a particular product or service that a customer has demanded. Besides, the bill also mentions the amount due that a customer is owed to the company. Let’s check out the other functions and features of a bill.
- A bill is a vital record for the customer about a business transaction after its completion.
- A bill is issued before the payment process is initiated.
- Moreover, a bill is that record that was issued as an invoice from the supplier that is recorded as a “bill” at the customer’s end.
How is an invoice different from a bill?
An invoice and a bill outline the same information about a specific business transaction. Both these accounting documents mention the amount corresponding to the product or service provided. The basic difference is that they are issued from two different parties.
For example, after the completion of a business transaction, the seller issues the invoice mentioning every detail. That same document after being received by the customer is recorded as a bill. After the completion of the payment procedure the business enterprise issues a receipt documenting the acceptance of the due amount.
Difference between an Invoice and an Estimate
An invoice or an estimate is similar but used for different purposes. Both an estimate and an invoice are issued by the business enterprise to their clients. The basic difference is an invoice is issued after the completion of the project whereas, an estimate is given before the project is started. An estimate gives a brief idea to the client about the kind of services they can expect from the seller and the cost involved. On the other hand, an invoice is typically an accounting document that states the amount that the client needs to pay.
Let’s check out what an estimate covers.
- The estimate is an overview of the business transaction.
- Details about the project for a better understanding of the customer.
- The timeframe of project completion
- Approximate cost involved
- And, other terms and conditions including legal information
What is a Quote?
A quote is a fixed price update regarding a specific project. It is a lot different from an estimate. The estimate is approximate data that may change. Whereas, a quote mentions the fixed price which is subject to a specific timeframe and is valid for a particular duration. Generally, a quote remains valid for 30 days from the date it is issued.
Now you have a super easy and smart invoicing software – Billbook. With this software, you can customize your invoice template. Send your invoice to your clients immediately and track other financial transactions with this software. For more updates visit the official website to know more about this!