Purchase Order

What is a Purchase Order Form?

A purchase order form is an accounting source document. When a business wants to buy goods from a supplier it issues a purchase order form to the supplier.

The purchase order form sets out details of the goods or services the business is ordering from the supplier. A legally binding contract is formed when the supplier accepts the purchase order.

The purchase order form will typically show particulars of the goods being ordered including, date, quantities, and agreed prices.

The original purchase order is sent to the supplier, and a copy of the purchase order is retained by the business to support the double entry bookkeeping transaction in the accounting records.

The purchase order form and other accounting source documents are more fully explained in our accounting source documents tutorial.

For further information see the Wikipedia purchase order definition.

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Last modified August 4th, 2014 by Michael Brown

About the Author

Chartered accountant Michael Brown is the founder and CEO of Double Entry Bookkeeping. He has worked as an accountant and consultant for more than 25 years in all types of industries. He has been the CFO or controller of both small and medium sized companies and has run small businesses of his own. He has been a manager and an auditor with Deloitte, a big 4 accountancy firm, and holds a BSc from Loughborough University.

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