Invoice in QuickBooks Online

Invoices vs. Bills in QuickBooks Online and How to create them

By
Easeify
on
Mar
15
,
2024

At Easeify, we specialize in bookkeeping within QuickBooks Online. Trying to figure out invoices vs. bills and how to create them in QuickBooks Online? This blog should provide some assistance. As always, you can contact us for additional help.

What’s Easeify?
A virtual bookkeeping firm that makes bookkeeping easy. We specializes in working with service businesses and non-profits on the cash basis of accounting. Get your books completed with your own dedicated CPA, keeping tax deductions in mind.
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Key Takeaways

  • Invoices are used when you need to receive payment from your customers. 
  • Bills are used to record invoices sent to you by a vendor which will need to be paid at some future date. 
  • Bills vs. expenses are used different in QuickBooks
  • You can create invoices and bills easily in QuickBooks Online. That way you can keep track of what your customers owe you and what you owe your vendors. 

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Summary

You can use QuickBooks Online to easily manage your invoices and bills. Both of these transactions serve a unique purpose in your accounting process. Before you start creating invoices and bills, it is important to know the difference between the two. 

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What is an Invoice?

Invoices are used when it is time to receive payment from your customers for products or services that you provided. Invoices will be included in your business income. This is one way you can collect money for the product or services you have provided.

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What is a Bill?

Bills are invoices sent to you by a vendor which you will need to pay. Although bills are technically business expenses, QuickBooks defines bills and expenses differently. A bill is money your business owes, but will pay at some future date (accounts payable). An expense is money spent at the time of purchase. Unlike with a bill, there is no delay between purchase and payment. with an expense.

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Creating an Invoice

1. Select + New.

2. Under the Customers heading, select Invoice

3. Select the customer you want to invoice. You can also add a new customer if they are not in your list of existing customers. 

4. Choose how you want to accept payment (Cards and/or Bank transfer). 

5. Review the Terms, Invoice date, and Due date. You can use the terms QuickBooks provides or create your own.

6. Select the Product/Service you want to appear on the invoice. 

7. Enter the quantity, rate, and amount as needed. 

8. Sales tax can be added to invoices as required. 

9. When you are done creating the invoice, there are several options for sharing it with your customer:

  • You can select Save and send if you are ready to email the invoice to your customer now. 
  • You can Save and close to send the invoice later. 
  • To send a paper invoice, select Save then Print or Preview. 
  • You can send your customer a link to the invoice via text by selecting Save and share link. 

10. You can make the invoice recurring if you want to invoice your customer at scheduled intervals.

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Creating a Bill

1. Go to Expenses and select Bills.

2. Select Add bill and choose from the list of options. 

  • Upload from computer. QuickBooks automatically fills in most of the information. Review the information and make any changes or additions. 
  • Create bill. Manually fill out all information including vendor, due date, category for the bill (such as advertising), and amount.
  • Create recurring bill. 

3. Bills go through three stages:

  • New bills go to the Review tab so the information can be checked for accuracy. 
  • Once reviewed, bills move to the Unpaid tab. 
  • When you pay a bill, it goes to the Paid tab. 

4. You can create a bill manually by selecting + New and then choosing Bill under the Vendors heading.