When running a business or conducting a transaction, transparency is critical to winning the customer’s trust and loyalty. One way to do this is by issuing a receipt after the payment has been made. Transparency is achieved, so both parties know the transaction details, such as the item sold and the amount paid. Sales receipts are a significant part of any business transaction. That means paying attention when creating receipts is crucial because they contain important information about a particular transaction.
The information contained in the sales receipts should always be accurate since it can affect your business operations and accounting process. You will likely have various miscalculations if you include the wrong information in your sales receipt. That means you need to know how to properly create a sales receipt, the information they contain, and how to issue them to your clients after a transaction. A well-laid receipt management system for your business will ensure you have records for all your business transactions.
This will help you to keep track of your finances as you can account for every penny earned and spent within the business. In this article, you will learn more about what a sales receipt is, what to include in the receipt and its importance to your business.
Sales Receipt Templates
Preparing a sales receipt can be challenging, especially when dealing with big purchases. However, a sales receipt should be accurate and perfectly created to fit all the sales details. Therefore, you should check out our sales receipt template, which you can download for free. Our sales receipt template allows you to effortlessly create and design a sales receipt depending on the type of sales you are conducting.
Our free-to-download sales receipt templates will enable you to create and prepare receipts for more than one client simultaneously.
Sales Receipt
A sales receipt is a document used to record the products and services sold to a client by a seller.
A sales receipt is proof that the seller was paid in full after providing certain products or services to the buyer. The receipts record all the goods or services sold, their quantities, and the price of each item sold. Additionally, the sales receipt will show the total amount paid for all the sold items. Also, the receipt will show any sales tax included in the transaction, but this depends on your location and the type of transaction carried out.
When the buyer is paying for the products or services in installments, the seller will issue a partial sales receipt to the buyer. The partial sales receipt will indicate the amount paid and the remaining balance. Therefore, a sales receipt is mainly used to show evidence of a transaction between a seller and a buyer.
What is a Gift Receipt?
A gift receipt is a record that indicates the items purchased but does not show the exact amount spent.
In this case, the recipient can return the receipt to the store and exchange the items for something else. However, the gift recipient will not be able to see the price of the items bought. Additionally, the gift receipt may include the name or barcode of the items bought. This allows the seller to track and account for the items sold. Ensure you clarify, once you issue a gift receipt, if or not the receipt allows returns or is only meant for exchanges.
Receipts Vs. Invoices
Sales receipts and invoices have so much in common. They both provide evidence of a business transaction and a sale. A receipt is a document issued by a seller after completing a business transaction with a buyer. The receipt is handed to the buyer after making partial or complete payments for the goods or services. The receipt should include all the items bought, the amount paid, the payment date, and the receipt number.
On the other hand, an invoice is a formal payment request document that the seller presents to the customer. The seller issues the invoice to the buyer once it is time for the buyer to pay for the goods or services provided. Moreover, the invoice is proof of sale between the seller and the buyer. Therefore, the invoice should include the details of both the seller and the buyer, an invoice number, the items sold, the due date for the payment, the exact amount to be paid, and the issue date.
When to Use Receipt and Invoice and Their Importance
A receipt is used and issued to a customer after they have made total payments for the goods or services provided. A receipt provides proof of payment and transaction between the seller and the buyer. Receipts are essential because they help a business owner or seller track all their expenses and accurately and efficiently calculate their income generation, profits, and loss accurately and efficiently.
Also, receipts are essential when a business is conducting a financial and tax assessment, allowing the owner to make accurate and better financial and business decisions.
Alternatively, an invoice is used and issued to a client before they make any payments to the goods or services provided. The invoice is used as a payment request by the seller. An invoice is vital to any business because they help the seller record and track all their sales. An invoice also provides insights into the revenue your business generates and the potential profits and cash flow expected.
Types of Sales Receipt
Below are the types of sales receipt templates that you will find on our website:
Art
An art sale receipt is usually issued to the customer after purchasing artwork. The seller provides the receipt once the buyer completes the agreed purchase fee. The art sales receipt should include the details of both the seller and the buyer, the details of the artwork, the exact price paid, and the date issued.
Bike
A bike sale receipt is a document used to document a bicycle’s sale and purchase. The receipt shows the details of the involved parties (seller and buyer), the type of bicycle sold, the amount paid, and the authorization. In addition, the receipt is used to show the bike’s condition at the time of purchase and prove that the buyer accepted the bike as-is and without warranty.
Boat
A boat sales receipt shows the sale and purchase of a boat or a water vessel. The receipt shows a change of ownership from the seller to the buyer. In addition, the boat sales receipt provides evidence that the seller received full payment from the buyer once the boat was handed over. The receipt should accurately describe the boat’s current condition and mention any additional items that come with the boat, like a trailer. The seller and the buyer should sign the receipt upon completion of the deal.
Car (vehicle)
A car sales receipt is used to show the change of ownership of a car. The car dealer (seller) provides the buyer with the car once the buyer makes total payments. The receipt should describe the car and mention any additional items that come with the vehicle. The buyer will need a copy of the signed receipt when registering the vehicle at the Department of Motor Vehicles (DMV).
Cat (kitten)
A cat sales receipt is a document that records the sale and purchase of a cat or a kitten. The receipt records the amount paid and the transfer of ownership for the cat. However, before the buyer makes full payments, they must complete and sign the document, which provides the buyer with financial and property (the cat) security. The buyer must make a deposit first to book the cat/kitten. The seller will receive the remaining amount once the buyer picks up the cat/kitten.
Dog (puppy)
A dog/puppy sales receipt is used to document the change and transfer of ownership of a dog/puppy. The buyer can pay for the dog in full or deposit in case they need the dog/puppy to be medically examined before pick-up time. If the dog/puppy is subjected to a medical examination, the buyer must pay the remaining amount to the seller/owner when picking up their dog/puppy. Moreover, the buyer can use the dog sales receipt to show that they are the new legal owners of the dog/puppy.
Equipment
An equipment sales receipt is a document showing proof of equipment sale and purchase. Usually, the buyer will be provided with the equipment as-is. The receipt covers all types of outdoor, indoor, and professional equipment. After making the payment, the buyer should ensure that the ownership of the equipment has been transferred to them and that they are the legal owners. Each party should remain with a signed copy of the equipment sales receipt.
Garage sale
A garage sale receipt is used by an individual conducting a garage sale. The receipt shows proof of the sale or purchase of items from a garage. The seller uses these receipts to see how much they have accumulated from the sales. Additionally, the buyer can use the receipts for tax purposes, especially if they plan to resell the items they just purchased. The receipt should include the seller and buyer’s details, the items sold, the amount paid, and the date the receipt was issued.
Girl Scout cookie
Girl Scout troops typically use a Girl Scout cookie sale receipt to give customers after buying their cookies. The receipt contains the name and contact details of the Girl Scout. This allows the buyer to reach out to them and order more cookies if needed. Additionally, the receipt will show how much profit the Girl Scouts have earned in their sales.
Gun (Firearm)
A gun sales receipt is a document that shows a legal sale and purchase of a firearm. The receipt should contain the full description of the firearm and the gun’s serial number. Additionally, the names, contact details, and signatures should appear in the receipt for accountability. Afterward, the buyer is required to make full payment to the seller.
Horse
A horse sale receipt is a document used to show the sale and purchase of a horse. The buyer can deposit if they want the horse to be medically examined before picking it up. However, the buyer can make full payment and pick up the horse immediately. The receipt will document the details of the involved parties, the type of horse sold, and the total amount paid.
Mobile home
A mobile home sale receipt is a document that shows proof of sale or purchase of a mobile home. The buyer must make a deposit or full payment of the mobile home to the authorized seller. If the buyer makes a deposit, they must complete the rest of the payment before the ownership of the mobile home can be transferred. In addition, the buyer will need the receipt when registering the mobile home with the Department of Motor Vehicle (DMV).
Motorcycle
A motorcycle sales receipt shows the transfer of ownership of a motorcycle from the seller to the buyer. The receipt should include the details of the seller and the buyer and the details and condition of the motorcycle. The transfer of ownership will happen once the buyer makes full payment to the seller. Additionally, once the transaction is complete, the buyer will take the motorcycle as-is. This guarantees that the buyer takes the motorcycle as it is, with no warranty. The buyer should make the receipt available with the Department of Motor Vehicle (DMV) during the registration process.
How to Make a Sales Receipt?
Making a sales receipt heavily depends on the type and size of your business as the seller or owner. Note that the sales receipt should be customized to meet the requirements of your business. Your personal and business details on the receipt can effectively allow your clients to engage with you. Therefore, finding a method that will allow you to make sales receipts for your business efficiently is crucial.
Handwritten receipts are usually effective and affordable when your business is still new. However, as your client base expands, it is crucial to get an automated way of making your receipts. This will allow you to serve many clients with little effort.
Below are ways you can use to make a sales receipt for your business:
Register tape
This receipt method is standard among businesses with a considerable customer base. In this case, the sales receipt is automatically printed out of a register tape. The receipt is usually customized and includes the business’s name, provides an accurate list of the items purchased, an issue date, the total amount paid, and the seller or business’s name and contact. A register tape is commonly used in gas stations and other businesses with high-volume sales.
Handwritten carbon
The handwritten carbon is the most common way to make a sales receipt, especially for personal or small businesses. Additionally, this method of receipt-making is convenient and affordable for a makeshift type of business, like conducting a garage sale.
Moreover, a handwritten carbon sales receipt can be used when performing a one-time task for a buyer. For instance, plumbing repairs. In this case, the service provider (seller) will hand over a handwritten sales receipt to the buyer after making a deposit. The seller will then provide another handwritten sales receipt at the end of the task.
Packing slip
A packing slip is a sales receipt used mainly by sellers who send or ship goods to their buyers instead of selling them in person. A good example is when a buyer buys an item online, the product is typically shipped to them by the seller regardless of location. The packing slip contains the complete list of all items purchased, their price, and the seller’s contact details. This sales receipt is generally shipped to the buyer with the bought products.
Information to Include in a Sales Receipt
Below are details that are mandatory when creating a sales receipt for your customers:
Receipt number
The receipt number should be placed on the top-right side of the receipt. The receipt number is essential as it allows you to identify a purchase uniquely. Also, the receipt number can be used as your company’s identifier. Finally, note that the receipt number makes tracking and recording sales easy.
Date
The date comes right after the receipt number. The date is crucial because it showed when the transaction was conducted and completed. It also shows when the receipt was issued to the customer.
Merchant’s information
A sales receipt should have all the necessary details of the seller. These details make it easier for buyers to contact the seller (company) if necessary. The receipt should have the accurate details of the seller or company. This includes the merchant’s name, phone number, street address, city, state, or zip code.
Customer’s information
The sales receipt should have a space where the customer will fill in their details. The customer’s details are necessary as it makes it easier for the seller or company to contact the buyer if necessary. This section should contain the name of the buyer, the name of the company they represent, their phone number, street address, and their city, state, or zip code.
List of the items (name)
This section should have a table with several columns and rows describing the items the customer bought. Each item should be placed in its column, followed by its description. First, provide the name of the item bought, then its quantity, then the price for each unit of items purchased, and finally, show the Sub Total. The description, quantity, price, and subtotal should all appear in separate rows on the table.
Payment method
After having a complete list of all the items purchased, there should be a total amount that the buyer is required to pay for the listed items. Any discounts given should be indicated in the sales receipt, and the discount should be deducted from the sub-total. If the customer’s purchase is subjected to taxation, the tax percentage should be indicated in the receipt, and the tax amount to be added to the subtotal.
Afterward, the customer will choose a payment method that they are comfortable and conversant with. The customer is allowed to pay using a check, cash, or credit card. The payment method should be accurately recorded in the sales receipt. Remember to indicate the check or credit number in the receipt.
Merchant and customer’s signature
After the payment has been transferred and the bought items have been handed over to the buyer, both the merchant and the customer must sign the sales receipt. The signatures are used to show that the involved parties are satisfied with the outcome of the whole transaction.
Bottom Line
Sales receipts are an essential part of any company’s financial stability. These receipts are considered formal documents that record the financial flow of the business. Sales receipts allow businesses to keep track of their finances by allowing the company to monitor its sales and purchases. As a result, it is easy to calculate the profit and losses incurred after a transaction; hence, it provides businesses with insights into how to make better short and long-term financial decisions.
Notably, receipts are essential when a business needs to meet the Canada Revenue Agency’s (CRA’s) financial requirements. CRA demands every business accurately record all its sales, purchases, and the taxes subjected to the buyers. This information is primarily available in sales receipts. Therefore, keeping all your sales receipts will enable you to file all your tax returns accurately. Additionally, with these sales receipts, you will have proof of all your sales and taxation in case of an audit.
Therefore, sales receipts are crucial for the survival of a business and help the merchants avoid any unnecessary financial implications that may occur because of poor sales and financial management. The sales receipts allow you to see all the sales and purchases and how much profit and loss you have made in the process. In addition, with these receipts, you will be able to file all your taxes accurately and adequately manage all your finances.