Question

Compare and contrast receipts and invoices.

Answer 1

While an invoice is a request for payment, a receipt is the proof of payment. It is a document confirming that a customer received the goods or services they paid a business for — or, conversely, that the business was appropriately compensated for the goods or services they sold to a customer. Though businesses are not legally required to provide a receipt for all transactions, receipts are virtually always given to a customer after they make a purchase, making them common among both traditional and e-commerce businesses.

Key Differences Between Invoice and Receipt

1. An Invoice is a request for payment and receipt is a confirmation of payment.
2. The significant difference between the two is that the invoice is issued prior to the payment while the receipt is issued after the payment.
3. The invoice is used to track the sale of goods or services. On the contrary, receipt acts as documentation for the buyer that the amount of the merchandise has been paid.
4. The invoice indicates the total amount due whereas the receipt indicates the total sum paid along with the mode of payment