They both record the same information: SALES. Invoices record sales on an accrual basis, sales receipts record sales on a cash basis.
An invoice records the sale as income and increases accounts receivable, as of the date of the invoice, even though you haven’t received the PAYMENT for the sale. To complete the sale process started by using an invoice, you must “Receive the Payment” against the invoice, which will reduce your accounts receivable.
This is a two step process: Increase to Accounts Receivable = Sale and Payment = Reduction to Accounts Receivable.
A sales receipt is used when you receive the PAYMENT at the time of the sale. In other words, this is a cash sale. In completing a sales receipt in QuickBooksTM, you record the sale as income and deposit the PAYMENT in to Undeposited Funds or a bank account, at the same time, using the “sales receipt” form.
This is a one step process: Sale = Payment.
In addition, in QuickBooks, a sales receipt is also often used when a client gives you a deposit towards future work.
To learn how to use QuickBooks more efficiently in your business, contact Teri at 619-463-6851 or by e-mail at email@example.com.