Learn something new every day More Info... by email
A bill and a receipt are used in two entirely different situations. A bill is presented when money is owed, while a receipt is given when an amount owing has been paid. Put another way, a bill is a request for payment, while a receipt is the acknowledgment of payment received.
Generally, bills are used for purchases made on credit, and receipts follow cash payments for goods or services. For instance, when a customer is paying for groceries, the clerk will total the items and hand the customer a receipt immediately after he or she receives the payment. A person who has an account with a telephone company, on the other hand, is likely to receive a bill about the same time each month with the specific amount owing. If the previous month's bill hasn't been paid, the amount will usually be added onto the current one, with perhaps an interest charge if the due date has long passed. This method of a bill and a receipt is used for consumer as well as business situations.
In business, a bill is usually known as an invoice. The term net 30 days is commonly used in companies to indicate that the invoice is due to be paid in total within 30 days of the time of purchase of good or services. A bill and a receipt may be used in different transactions for a customer who has an account with a company. If the customer is making a larger purchase, he or she may want to use credit and be billed, but if for just one or two items, paying cash and keeping the receipt for proof of payment may be preferred.
Invoices or bills are typically prepared using computer software in office environments, while many receipts are created on cash registers in stores. Receipts may also be handwritten at the time of a cash payment such as when a landlord receives the monthly rent from a tenant. Unlike cash register receipts or invoices, a handwritten receipt isn't often itemized, but rather just includes the total amount. Invoices and receipts that are itemized usually first show the net amount, then have any taxes added or discounts subtracted before the total is placed at the bottom. Yet, the totals on a bill and a receipt will always mean different things.
The total amounts on all types of receipts indicate funds paid. The total amounts on every kind of bill signifies that the amount is still owing unless an invoice is stamped "paid." Rather than use a paid stamping or marking on a bill, most businesses today indicate on a separate statement, or on upcoming bills, that the previous amount owing was received.
I suppose a bill could become a receipt if the bill is stamped "paid in full" or something similar. A receipt is for a transaction that has been paid in full, while a bill or invoice might remain unsettled for weeks or months.