Difference Between Sales Receipt and Invoice in QuickBooks Online
What’s the difference between a sales receipt and an invoice in QuickBooks Online?
Many businesses will use one or other when recording a sale in QuickBooks Online, but they’re not exactly the same.
Before creating the sales document in QuickBooks Online, think about how payment is received.
Sales receipts are generally used when payment is received immediately, whereas invoices are used when payment is received later.
Why does this matter? If customers fail to pay, then businesses won’t know since they’ve created sales receipts. By using invoices, businesses can easily track unpaid and overdue invoices in QuickBooks Online.
Creating an invoice requires someone to take an additional step of receiving payment in order to “close” the invoice.
Using a sales receipt or an invoice will also affect your reporting in QuickBooks Online.
You may get different numbers if you switch between cash and accrual accounting methods when you run financial reports.
How does this affect Amazon sellers?
Sellers on Amazon can use either a sales receipt or an invoice in QuickBooks Online since Amazon handles payments. That doesn’t mean that they should randomly create invoices or sales receipts.
In fact, many Amazon sellers will be tempted to create sales receipts since it’s simpler (one step) than creating an invoice and receiving payment (two steps).
Strictly FBA sellers can use sales receipts since Amazon handles payment and shipping: they don’t get the sales proceeds until the order is shipped.
However, FBM sellers may want to use invoices instead of sales receipts since some orders may take longer to ship. Using invoices allows FBM sellers to accurately track inventory and whether or not an order has been shipped.
Sellers should consider using invoices for both FBA and FBM sales if they sell to businesses. Amazon gives businesses net terms, so sellers may not see payments for up to 90 days.
There are other considerations when handling Amazon transactions. FBA sellers should think about how they’ll handle inventory and cash reimbursements. Sellers shouldn’t adjust inventory quantity each time these events happen.
Regardless of how sellers handle their accounting, they’ll want to remain consistent. Consistency will save time later when reconciling books, training employees, and working with bookkeepers and accountants.
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