8 IMPORTANT DIFFERENCE BETWEEN PURCHASE ORDER AND PURCHASE INVOICE

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Purchase invoice and purchase order are two terms that are often confused. Although they may have almost the same information, purchase invoices and purchase orders are not the same.

A purchase invoice is a document the seller sends to the customer outlining the quantity and cost of the goods purchased by the customer

A purchase invoice typically contains the seller's name, the seller's signature, the number of delivered products, the amount owed, and the due date.

A purchase order, on the other hand, is a document sent by the buyer to the supplier outlining the kind, number, and agreed-upon price of the goods and services he intends to purchase from the supplier

A purchase order typically contains the buyer's name, the seller's signature, the buyer's signature, the number of goods demanded, the price of the goods, and other terms of the transaction.

Difference Between Purchase Order and Purchase Invoice

1. While the purchase order is created by the buyer and sent to the seller, the purchase invoice is created by the seller and sent to the buyer.

2. The purchase order has a unique number assigned to it called the purchase order number.

A purchase invoice, on the other hand, contains an invoice number, which is a special number given to a purchase invoice.

3. A purchase invoice is used to request payment for goods that have been delivered whereas a purchase order is used to place orders for goods.

4. The first document sent in a purchase transaction is a purchase order.

It is given out at the beginning of a purchase transaction by the buyer and contains the relevant information regarding his intended purchase of goods.

On the other hand, a purchase invoice is the last document in a purchase transaction.

It is issued at the end after goods have been delivered and the terms of purchases have been fulfilled.

5. A purchase invoice is created after the provision of goods and services, whereas a purchase order is created before the provision of goods and services

6. Unlike a purchase invoice, which is typically signed by only the seller, a purchase order is typically signed by both the buyer and the seller.

7. A purchase invoice is used to remind the buyer to make a payment while a purchase order is used to confirm demand for goods and services.

8. The purchaser order defines the terms of purchase whereas the purchase invoice confirms the terms of purchase.

From the foregoing distinction, we can conclude that the main difference between a purchase order and a purchase invoice is that a purchase order is used to place an order for goods and services whereas a purchase invoice is used to request payment for orders of goods and services that have been delivered.

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