A sales order is a record of a sale you have agreed with a customer but have not yet invoiced. It is used when time passes between agreement and delivery — for example when goods have to be ordered in, reserved or delivered later.
What it does
Holds the agreement: which items, quantities and prices the customer has said yes to.
Can reserve goods so they are not sold to someone else.
Later becomes an invoice, when the goods are delivered or paid for.
Sales order vs. invoice
The sales order is the commitment; the invoice is the actual settlement that is posted to the accounts. A sales order does not affect the accounts until it becomes an invoice.
Read more in Sales orders and see quick how-tos in Sales order (quickguides).