An invoice is a list of products or services that were availed by the customer or buyer. An invoice is similar to a receipt, but the latter is issued before payment while the latter is issued after the payment.
In this article, we will be helping you create an invoice in Google Sheets. We have provided templates that you can download for free as well as provided you with a simple and easy guide on how to create an invoice. Read on below!
Listed below are the most important elements of an invoice. Make sure to include all the elements so that you can create a detailed as well as visually appealing invoice.
1. Seller’s complete information: One of the most important element of a business invoice is the seller’s complete information. This should be the first information you should include in the invoice. The seller’s complete information comprises of the business name, business address, and contact information (phone number, email, or website). The position of the seller’s complete information should be placed on the top (i.e. header).
2. Buyer’s complete information: Aside from the complete seller information, the buyer’s complete information should be included as well. The buyer’s complete information is a necessary component for payment purposes. It is also important for legal purposes that may possibly arise due to conflicts between the buyer and the seller. The basic buyer information should include the following: name of customer (or name of customer representative) and contact details (landline or mobile number, email address).
3. Invoice date: Often overlooked, the invoice date is also a very important element in an invoice. The invoice date pertains to the date in which the product was purchased. Similar to the listing down the buyer’s complete information, the invoice date is also important for legal purposes.
4. Invoice or transaction number: It is common practice for each invoice to have a distinct or unique invoice or transaction number. The reason is basically for documentation and financial purposes. The seller, who will be doing the accounting and the creating of financial statements will not be confused with transactions having the same transaction or invoice numbers.
5. Goods or services delivered: Just like in a sales receipt, the invoice also lists all the goods or services that were purchased by the buyer, customer or client. When listing the goods or services delivered, listing them down in detail is not necessary as you can just list down the following information: name of product, item number, color, and quantity. You can also list down the volume or weight of each item that was purchased.
6. Grand total or sub-total: Total or subtotal pertains to the total amount of goods or services that were purchased. The subtotal is the sum of the price of all the goods or services. Meanwhile, the grand total is the final amount, which includes the taxes, promotions, discounts, and other charges or fees.
7. Additional payment and deductions: As previously mentioned, taxes, charges, and other fees are covered in every transaction. Most of the time, additional payment and deductions are shouldered by the buyer.
8. Method of payment: The method of payment (either in cash, debit or credit card, or payment service) must also be specifically listed in the invoice. You may also see construction invoice examples.
9. Terms and conditions: Terms and conditions basically refer to arrangements, provisions, requirements, rules, specifications, and standards in regards to the purchase of the good or service. Take note that the terms and conditions do not only apply to agreements or contracts but also for invoices. The entire terms and conditions should not be included in the invoice, as they can be listed in the seller’s website.
10. Notes: The notes section acts like a suggestion box where customers can list down their comments or suggestions in regards to not only the product but also to the company or seller. Also, promotion and greetings are additional information that can be written in the invoice. You may also see plumbing invoice examples.
11. Signature: Also often an overlooked element of an invoice, a signature is very important when creating invoices. The signature should be affixed by the buyer, and sometimes the seller as well. Signatures are important for legal purposes.
Listed below are steps to designing a good invoice in three platforms: Google Docs, Microsoft Word, and Microsoft Excel.
1. Creating an invoice in Google Docs: To begin in Google Docs, log in to your Google account then access Google Drive. Click on the “New” button to create a new Google document. From there, you should then scroll down and look for the “From a template” button from the drop-down menu. After locating it, type “invoice” in the search bar so that you can choose from a selection of invoice templates. After choosing the preferred the template, fill out the template with the necessary information such as the company name, contact details, list of items purchased, and signature.
2. Creating an invoice in Microsoft Word: Creating the invoice in Microsoft Word is similar to creating the invoice in Google Docs. After opening Microsoft Word, look for “New” tab in the “File” menu. A drop-down menu will then show up, then you can choose from the collection of invoice templates. After choosing your preferred invoice, write the details such as the business name, address, logo, and contact details.
Below the header, input the basic customer information as well as the invoice number, invoice date, payment methods, and terms and agreement. Don’t forget the list down the products or services availed by the customer together with these information: item description, quantity, and amount as well as the charges associated with each item. Then, you calculate the subtotal (including the taxes, deductions, and other charges and fees).
3. Creating an invoice in Microsoft Excel: Creating an invoice in Microsoft Excel is probably the easiest compared to Docs and Word. The process begins after opening Excel. Choose the “Create a New Workbook” function, then select the invoice icon. After that, you can input the company information, customer information, list of goods or services purchased, terms and conditions, date, and payment methods.
Not all invoices have the same function. Listed below are the different types of invoices. Use the best type that applies to your business or company.
1. Normal invoice: This is the most common form of invoice. A normal invoice is also called a generic invoice which can be used when purchasing goods and services. A normal invoice comprises of information such as the list of the products or services sold to the customer, terms and conditions of the transaction, invoice number, issuance date, and due date, just to name a few.
2. Commercial invoice: Commercial invoices are mostly used in foreign trade transactions. This type of invoice is important since it is one of the main requirements checked by customs and immigration authorities.
3. Utility invoice: A utility invoice is given to customers who are availing of utility services such as water, electricity, and Internet, just to name a few. This service invoice contains important information for the service transaction such as the type of services rendered, the period or duration of such services, and the specific amount of consumption.
4. Time-billing invoice: A time-billing invoice is used by consumers who are paid at an hourly or daily rate. This type of invoice is basically given out for time being rendered. The hourly or daily rate of the service provider is listed down in the time-billing invoice, as well as the nature or service provided, and the time spent by the service provider in working for that certain project.
5. Milestone-based invoice: A milestone-based invoice is given when a milestone is achieved. The terms and conditions should be prioritized when creating a milestone-based invoice, and should list down the period of time worked by the seller, the percentage of completion of the work, and the amount due needed to be paid by the client. One specific example would be a freelance invoice.
6. Pending invoice: A pending invoice is when a customer does not pay the full amount. He or she is then given a pending invoice so that he will settle the remaining amount in a specific date. The pending invoice basically states the individual still has pending payment that he needs to pay at a future time. You might also be interested in payment invoice.