What are line items on an invoice?

Line items on an invoice refer to a detailed breakdown of the goods or services that have been billed to a customer. This breakdown typically includes the description of each item, the quantity, the unit price, and the total amount for each individual item. This level of detail is crucial because it allows both the payer and the recipient to discern exactly what products or services were provided, understand the pricing structure, and validate charges against contracts or purchase orders.

This clarity in financial documentation is vital for effective accounts payable processes, as it enables accurate record-keeping and facilitates reconciliation. In summary, line items serve the essential function of detailing every component of the billing, helping to avoid disputes and misunderstandings regarding what is being charged and why.