What does an invoice typically include?

An invoice is a critical document in business transactions, as it serves as a formal request for payment from a seller to a buyer. It typically includes essential details such as the quantity of items sold, a description of those items, the price, and the terms of payment. This makes it clear what is owed and establishes the expectations for payment timing and method. The inclusion of these elements ensures that both parties have a mutual understanding of the transaction, which is essential for effective accounting and recordkeeping.

While the other options may relate to various business documents, they do not accurately describe the primary purpose or typical content of an invoice. A legal contract establishes broader terms and conditions of an agreement, while documents related to payroll deductions pertain specifically to employee compensation rather than sales transactions. Lastly, a financial health report focuses on a company’s overall financial status rather than the specific details of individual transactions represented in an invoice.