A Purchase order is the means by which you record the quantity and price of goods or services that you are going to purchase from a Suppliers (Creditor), and the manner and date by which they are to be supplied.
A Purchase order can specify stock and non-stock Items of any price or quantity. When the goods are received, one or more Receives are created for some or all of the items specified on the Purchase order. The liability for the cost of the goods is not incurred for a Supplier’s account until the goods are Received.
After creation, a Purchase order is usually printed and faxed, mailed or e-mailed to the relevant Supplier.