Receipt is proof of the payment made or payment received. When the goods is purchased or services are availed on credit basis, then the supplier issues the credit invoice for that particular purchase or services rendered by him. Later on, when the payment of the same goods or services is made by the purchaser in cash or through cheque in full or in part as the case may be, then the seller is supposed to issue a receipt as a proof of payment.
Some time, the money is paid in advance in that case also a receipt is issued by the receiver. There are so many business transactions for which neither bills nor cash memos are issued. Only receipts are issued . For example:- Municipal taxes, traffic challans, donations, Insurance premiums, fixed deposits with banks, loans etc.
Receipt is to be issued by the receiver of money whether the amount is paid in cash or cheque. Generally, a receipt contains the following details:-
- Date of payment
- Serial number
- Amount in words and figures
- Receiver’s name & address
- Name & address of the person who is making the payment
- The particulars against which the payment is made
The receipt must be signed by the receiver of money. Receipt is made in duplicate but according to the requirement of particular organization, more than two copies also can be prepared.
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