Glossary · Sales and receivables
Estimate
An estimate is a written offer telling a customer what a job or order will cost before the work starts. It lists the items, quantities, prices and tax, and often an expiry date. An estimate creates no debt and posts nothing to the books until the customer accepts it and it becomes an invoice.
Glossary / Estimate · Also called Quote, Quotation, Bid, Proposal
How it works
Estimates, quotes and bids are the same idea with different names by trade. Contractors tend to say bid or estimate, suppliers say quote. All of them are offers, not bills.
Because an estimate is not a transaction, it has no effect on income, receivables or tax owed. Its value is in the follow-through: when the customer says yes, the invoice should come from the estimate so the price agreed is the price billed.
Some businesses treat an estimate as a firm price and others as a best guess with a range. Say which on the document, and set an expiry date so an old price does not get accepted after costs have risen.
Worked example: A kitchen painting estimate
A painter quotes a homeowner $2,400 for a kitchen and hallway: $1,800 of labour and $600 of paint and supplies, valid for 30 days. Nothing goes in the books yet.
Two weeks later the homeowner accepts. The painter turns the estimate into an invoice for $2,400 plus tax. Only now does income of $2,400 appear, along with the receivable. If the homeowner had said no, the estimate would simply be closed, with nothing to reverse.
In AcboBooks
In AcboBooks, an estimate posts nothing. It carries items, quantities, rates, taxable lines, an expiry date and custom fields, and has a status of open, accepted, closed or invoiced. Create Invoice turns it into an invoice in one step, and Progress Invoice bills a percentage of it or chosen lines, tracking what has been billed so far.
Related terms
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Updated October 25, 2026. General information, not tax, legal or accounting advice. Rules and rates change; check with the IRS, the CRA, your state or province, or your accountant.
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