![]() ![]() Unlike invoice, which is a true invoice and as it results in a financial transaction, hence so it serves as a basis for accounting entry to be made in the books of both the parties. ![]() As proforma invoice is a dummy invoice and used for the purpose of creating sales, therefore no entry is made in the books of accounts for the financial transaction.As opposed to invoice, which is issued by the seller to the buyer to request payment of goods delivered. Proforma invoice is provided by the seller, on the request of the buyer before the placement of the order.Proforma invoice is used for the creation of sales, whereas invoice is used for confirmation of sale.Conversely, Invoice is a sort of bill, displaying the amount due to the buyer. Proforma invoice is a kind of quotation, containing a commitment by the seller to supply goods at the specified rate and date.On the other hand, invoice refers to a commercial instrument delivered to the buyer containing the details of products or services provided by the seller. A document similar to the normal invoice, which provides information to the agent regarding the particulars of the goods to be delivered, is known as proforma invoice.The differences between proforma invoice and invoice can be drawn clearly on the following grounds: Key Differences Between Proforma Invoice and Invoice Discount, if any, provided by the seller.The word invoice is indicated at the top of the face of the document. It shows the indebtedness of the buyer towards the seller. ![]() The document is used to request payment from the buyer of goods. Invoice refers to a non-negotiable instrument raised by the seller and delivered to the buyer containing the details of products or services provided to him. It is a declaration by the seller to provide the products and services to the buyer on the specified date and price.Īs the document does not constitute actual sales, so no entry is made on the issue of the proforma invoice in the books of the seller for accounts receivable and the receipt of the buyer for accounts payable. quantity, price, weight, kind and other specifications. The instrument contains a description of goods, i.e. No entry is made, as the invoice is not a true invoice.Īn entry is made in the books of accounts.Ī proforma invoice is a commercial pre-shipment document prepared by the seller and delivered to the buyer/agent, to convey information of the goods to be delivered. To inform the buyer, the actual amount due for payment. To help the buyer in taking decisions, regarding whether to place an order or not. Proforma invoice is similar to a normal invoice, provides information to the agent/buyer regarding the particulars of the goods yet to be delivered.Ī commercial instrument delivered to the buyer containing the details of products or services provided by the seller is known as an invoice. Have a glance at this article to know the significant differences between proforma invoice and invoice. While an invoice states the total amount due, for the convenience of the purchaser, proforma invoice is used as quotation or a demand for payment, when the company is dealing with new party, or with the party, whom the firm does not have any credit arrangement.
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