Which document would you use to record revenue when you deliver a service and payment is received at the time?

Which document would you use to record revenue when you deliver a service and payment is received at the time?

• A. Sales Receipt
• B. An Invoice
• C. Bank Deposit
• D. Credit Memo

Answer: (A)

When payment is received at the moment you deliver the service, the best document to use is a sales receipt. It captures both the sale and the cash received in one record, proving that revenue was earned and that money came in at the time of the transaction. A sales receipt typically shows the date, a description of the service, the amount charged, and the payment method, making it ideal for immediate-payment scenarios. An invoice, in contrast, is a request for payment to be made later; it does not reflect cash received yet. A bank deposit records the money actually deposited into the bank, but it doesn’t tie the cash to a specific sale or revenue event. A credit memo is used to adjust or offset amounts due on a prior sale, such as for returns or allowances, not to document a standard revenue when payment is received.

When payment is received at the moment you deliver the service, the best document to use is a sales receipt. It captures both the sale and the cash received in one record, proving that revenue was earned and that money came in at the time of the transaction. A sales receipt typically shows the date, a description of the service, the amount charged, and the payment method, making it ideal for immediate-payment scenarios.

An invoice, in contrast, is a request for payment to be made later; it does not reflect cash received yet. A bank deposit records the money actually deposited into the bank, but it doesn’t tie the cash to a specific sale or revenue event. A credit memo is used to adjust or offset amounts due on a prior sale, such as for returns or allowances, not to document a standard revenue when payment is received.