What is a Receipt?

A receipt is a written document triggered by the receipt of something of value from a third party. This document acknowledges that the item has been received. A receipt may contain the date of the transfer, a description of the item received, the amount paid for the item, any sales tax charged as part of the transfer, and the form of payment (such as with cash or a credit card).

Reasons for Issuing a Receipt

Receipts are usually associated with the delivery of goods or services from a supplier . They can be used for several reasons, including the following:

• Ownership transfer . The receipt documents the transfer of ownership to the buyer; this is most likely to be the case for a high-value item.

• Control point . The receipt acts as a control, so that the buyer has proof of the amount paid, and the seller has proof that the item was sold to the buyer.

• Accounting . To form the basis for an accounting entry to record the underlying transaction; this is most commonly the case when the underlying accounting system is a manual one.

• Ownership documentation . To document ownership for insurance purposes; this is a good way to establish the insurable value of the asset.

• Proof of delivery . As proof of delivery from the supplier, in case goods are returned under warranty.

• Proof of sales tax paid . The receipt provides evidence that a sales tax was paid as part of the transaction , so that the buyer is not liable to pay a use tax .

Who Creates a Receipt?

A receipt may be automatically generated by the seller (such as by a cash register). Or, under more informal or low-volume circumstances, a receipt may be produced manually by the seller.