![]() ![]() This payment term is usually reserved for recurring deliveries. CND: This stands for “cash next delivery,” which means the payment must be made before the next delivery.COD: This stands for “cash on delivery,” which means the goods or services must be paid for in cash at the time of the delivery.2/10 Net 30: Payment is due in 30 days, but the customer can receive a 2% discount for payment within 10 days.15 MFI: Payment is due on the 15th of the month following the invoice date.EOM: Payment is due at the end of the month in which the invoice was received.You’ll also sometimes see Net 60, Net 90, etc. Upon receipt: Payment is expected as soon as the client receives the invoice.CIA: This stands for “cash in advance,” which means the full payment must be made in cash before the goods or services will be delivered.PIA: This stands for “payment in advance,” meaning payment must be made in full before the goods or services will be delivered.1MD: This denotes a payment credit for a full month’s supply.Here are some of the most common invoice payment terms you need to know. Payment terms are usually included on an invoice as an abbreviation. For instance, you’ll want to include early payment discounts or if you expect an upfront deposit. Other payment terms: Your invoice should include any other payment terms the customer needs to know.For instance, you might accept credit cards, online payments and ACH payments. The payment methods you accept: The invoice should include a list of acceptable payment methods.The currency you want to be paid in: If you frequently work with international clients, you may want to specify the currency you want to be paid in.How much the invoice is for: The invoice should clearly state how much the customer owes you.The invoice number: The invoice number allows your customers to keep track of all the invoices you send them.(You’ll learn more about those terms below.) The due date: The due date is when you expect to receive payment on the invoice – many invoices include standard payment terms like Net 14 or Net 30.The invoice date: This is the date when you’re sending the invoice.Here is an overview of the information you should include. When you send a new invoice to a customer, it should include all the information they require to pay you accurately and on time. The more straightforward these are, the easier it will be for your customers to pay you on time. It’s important to set up transparent payment terms, so your customers know what to expect. The payment terms will also sometimes include the penalties for a missed or late payment. They let your customers know how you prefer to be paid, and when they need to pay you by. ![]() When you send your customers an invoice, the payment terms set the expectations regarding future payment. This article will look at 15 common accounting payment terms and how to use them in your business. If you don’t set up the right payment terms with your customers, this can lead to late payments, poor cash flow and unnecessary stress in your business.įortunately, there are simple steps you can take to improve your billing methods. When you’re a small business owner, getting paid on time is a top priority. This article is for small business owners who want to use better accounting practices to receive payments on time.Your understanding of common accounting payment terms and strategies can optimize your ability to receive fees in a timely manner.By setting up the proper payment terms with your customers, you’ll avoid overdue bills, poor cash flow, and financial stress.Receiving payments on time is important for any small business owner. ![]()
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