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How to create a system for invoicing


One thing that every business has to deal with is invoicing. Many companies have to pay invoices that come in once a month from other companies, which is known as their accounts payable. And every most companies have to send out invoices in order to get paid for the services that they are providing or to get paid for the products that they are providing to other businesses, this is known as the accounts receivable. But regardless of is you have invoices you need to pay each month or if you need to send out invoices each month so you get paid or if you have both one thing that you are going to need to do is to create a system for your invoicing so that you can keep better track of all of your invoices.

Difficulty rating: Easy

Step one:
The first thing that you are going to need to do is to create some file folders. You are going to want to have file folders for both your accounts receivable and your accounts payable. The best way to arrange the folders is in alphabetical order. If you have certain companies that you deal with on a regular basis and receive or hand out numerous invoices too you can give them their own folder.

Step two:
The next thing that you need to do for accounts receivable is to figure out which day you are going to mail your invoices and depending on how many invoices you have to mail out you are going to want to set aside one or two days to create those invoices so you can mail them to your customers.

Step three:
The next thing you want to do for your accounts receivable invoices is to create the actual invoices. Remember when creating an invoice you want to make sure it includes some key components. You will want to make sure that your invoice has an invoice date, an invoice number, an address of where to send the payment, a payment due date, a list of goods or services provided with their prices (include sales tax and shipping amounts if applicable), and you want to include a total amount due.

Step four:
After you have created the invoice you are going to want to make a copy for your records and then file it in the appropriate folder.

Step five:
Once you have mailed out all of your invoices you are going to want to create a way to be sure that your customers are paying their invoices. One of the best ways to do this is to track your cash receipts on a daily basis. Basically what you are going to want to do is to write down the invoice number that is being paid, how much is being paid, what day it is paid and the check number from the payment.

Step six:
Once a month you are going to need to enter in your cash receipts into your accounting software program so that you can keep track of all of your invoices and figure out which ones are paid and which ones are still outstanding.

Step seven:
Now you are going to need to deal with your accounts payable invoices. The best thing to do with these is to track them in a file folder on a daily basis. Basically what you are going to need to do is to match the invoices as they come in with the purchase orders, so that you can account for all of the invoices.

Step eight:
Now you are going to need to set aside a day or two to enter in all of your invoices into your accounting software so that you can print out the checks to pay the invoices. The day you pick should be a few days before the due date of the invoices. Keep in mind that most companies set aside a few days twice a month so they can pay the invoices on the 15th and on the 25th, but what this depends on is when the invoices are actually due.

Step nine:
Now that you have entered in the invoices into the accounting system you are going to want to mark each invoice as paid and then file it in the appropriate file folder.

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