Invoices are essential business documents as they record the transactions of the company. It also records the list of products or services sold, as well as the list of clients. For the invoice maker, these help in record-keeping and documentation, and therefore have a historical value (business-wise, at least), and organization.
The type of invoice depends on the type of the business and the client. These different types differ in function as well. Below are the usual types of invoices used in business:
· Pro forma invoice. This type of invoice does not demand for payment. Think of this as a pre-invoice. Pro forma invoices can be sent before the completion of work for a customer. However, this notifies a client the amount that he should pay after the completion of the work or project.
· Interim invoice. This type of invoice takes the value of a large project and divides it into multiple payments. This helps the supplier or service provider in money management. The larger the work or the project, the larger the expenses. The supplier does not necessarily need to wait for the project completion; he can ask for payments after a certain part of the project is finished. He will then use that cash to cover some of the expenses.
· Final invoice. This is the type of invoice that is sent after the completion of the project. It notifies the client that the work is done, and thus, demands for payment from your customer, unlike a pro forma invoice.
· Past due invoice. As its name implies, this type of invoice is sent when your client fails to pay on the due date. This invoice may include information about additional fees such as late fees.
· Recurring invoice. This type of invoice is for ongoing services such as monthly subscriptions or memberships.
· Credit Memo. This type of memo is sent as an acknowledgement that you, the supplier or provider, are under obligation to pay your client. This usually happens when the customer returns products or is unsatisfied with your services. The amount specified to this memo should be equal or less than to the one specified in your customer’s original invoice.
· Miscellaneous Invoice. This type of invoice is sent to ask for payment of miscellaneous fees.
How to Create Invoice
There are no specific guidelines on how to make invoices, but there are certain elements that need to be present in an invoice. Fortunately, you do not have to worry about that as there are invoice templates on the Internet.