![]() One of the primary purposes of a pro forma invoice is to streamline and smooth out the sales process between buyers and sellers. What is the purpose of a pro forma invoice? The buyer should not include a pro forma invoice in accounts payable, and the seller should not include it in accounts receivable. You should review the information included in a pro forma invoice for accuracy, but there is no need to send payment when a pro forma invoice is received. ![]() The pro forma invoice is not a formal request for payment. In short, a pro forma invoice offers documentation of a shipment ahead of time whenever that information might be required. While not leglly binding, a pro forma invoice may help a buyer apply for an import license, for example, or it could help a buyer open a line of credit for the purchase. However, when ordering goods from a supplier, especially overseas, a pro forma invoice may be used to lay out the intended details of the shipment. A business might pay a monthly utility bill, for example, without any other documentation from the utility company beyond the bill itself. Transactions do not always require a pro forma invoice. If you need a pro forma invoice template for your business, you can consider this pro forma invoice example: Download PDF How does a pro forma invoice work? While pro forma invoices tend to follow the same general template, there are no standardized or legally regulated guidelines that dictate exactly how a pro forma invoice should be formatted, presented, or written.
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