Which form is used when a customer pays at the time of sale?

• A. Invoice
• B. Sales Receipt
• C. Receipt
• D. Credit Memo

Answer: (B)

When a customer pays at the time of sale, you use a sales receipt. This form records the sale and the payment in one step, so there’s no accounts receivable to track—the money is received immediately and the sale is closed out. It also updates cash or bank balance and, if you’re tracking inventory, reduces that inventory and records the cost of goods sold as part of the same transaction. An invoice is used when payment is expected later, creating a receivable. A credit memo adjusts amounts billed after a sale due to returns or allowances. A plain receipt is just a proof of payment and isn’t the standard form tied directly to recording the sale in accounting.