FreshBooks

With FreshBooks freelancers or creative consultants can easily and professionally create invoices and send them to clients from their desk or on the go (Free to use for up to 3 clients).

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FreshBooks is a popular online accounting software and has received several awards for its exceptional customer service. It is designed to manage the needs of people who run a business and need to create invoices, bill clients, track time and expenses and manage projects. You can give your invoices a professional touch by branding it with a logo and you can receive payments from your clients through numerous payment gateways, including PayPal, iTransact and Authorize.Net.

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Here is a nice little review about FreshBooks.