Technical jargon can be confusing to understand, but bills and payment receipts should not be, as they can be a necessity for your business.
A bill is a document provided by your vendors to inform you of how much you owe them for the products or services they have supplied to you.
This bill will also provide details like the payment sum, methods, and credit terms if any.
Regardless of whether immediate or deferred payment is required, a bill should be provided so that you can start preparing when and how much to pay.
Outstanding Balance on a Bill.
On the other hand, a purchase receipt is documented proof given to you by your vendors to acknowledge that you have made the payment, and the business transaction has occurred.
When goods and services sold are paid for, a purchase receipt should be provided so that proper documentation of the transaction can be done by both you and your vendor.
In short, a bill is a payment request, and a payment receipt is proof of payment.
In the next article: Learn how to mark your bill as paid.