Legal Definitions - purchase order

A purchase order is a document that a buyer sends to a seller to request goods or services. It is a legal agreement between the buyer and the seller that outlines the details of the transaction, including the quantity, price, and delivery date of the goods or services.

Once the seller receives the purchase order, they are authorized to deliver the goods or services to the buyer. The buyer agrees to pay for the goods or services at a later date, as specified in the purchase order.

ABC Company sends a purchase order to XYZ Supplier for 100 units of a particular product. The purchase order specifies the price per unit, the total cost of the order, and the delivery date. Once XYZ Supplier receives the purchase order, they are authorized to deliver the 100 units of the product to ABC Company. ABC Company agrees to pay for the 100 units at a later date, as specified in the purchase order.

This example illustrates how a purchase order is used to authorize a seller to deliver goods with payment to be made later. It also shows how the purchase order outlines the details of the transaction, including the quantity, price, and delivery date of the goods.