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Trade Discount are considered cost of sales/reduction in sales dependant upon who the customer is. Cash Discount is always considered Increasing Interest Expense/Reduction of Interest Expense, dependant upon who the recipient is.
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∙ 15y ago
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Will trade discount be entered anywhere in accounting?
Trade discount is not shown any where in accounts as cash is received with discounted amount and sales also shown with reduced price.
Difference between trade discount and cash discount?
A trade discount occurs when an item is offered along with another item that is paid for. A cash discount is a reduction in the price of an item.
What is the journal entry for a cash purchase with discount?
Debit purchasesCredit cash / bankno entry for trade discount and in case of cash discount:Debit purchasesCredit cash / bankcredit discount
What is trade and cash discount?
Trade discount is the discount which is in actual sale price of unit at the time of sales and never shown in books of accounts. Cash discount is the discount in value of accounts receivable after sales completed.
What is difference between cash discount and trade discount?
cash discount enable the buyer to pay promptly while trade discoint is a discount given to the buyer so that he can buy more goods
Bring out the difference between trade discount and cash dicount?
Cash discount is the discount in amount in accounts payable while trade discount is on sales price discount which is not recorded in business books and transaction is recorded at discount price.
Can you Give some examples of cash discount and trade discount?
can you give some example if cash discounts?
Differentiate between cash discount and trade discount?
Cash discount is a discount offered by a seller to a buyer for paying earlier than the due date, whereas a trade discount is a discount provided by a seller to a buyer based on the quantity or value of goods purchased. Cash discount reduces the actual amount to be paid, while trade discount is deducted from the list price before calculating the invoice amount.
What is the accounting treatment for a refund to customer?
Is it right that I debit the refund to [Sales returns] and credit it to [Cash at bank]? But the answer given by my teacher is that the refund is debited to [Trade receivables] and credited to [Cash at bank].
Define quantity discount trade discount and cash discount and explain the importance of discount for the business in terms of marketing?
quantity discount and trade discount are the same thing. it is used when the dealer wants to sell in bulk. while cash discount is given when he wants prompt payment.
What is the accounting treatment for reimbursement?
The accounting treatment for reimbursement will be an expense to the organization. This will be credited on the cash book which indicates that the company has paid out money.
Explain the difference between trade discount and cash discount?
A trade discount is a discount that a manufacturer or wholesaler makes to the retail price of a product when selling to a reseller. A cash discount is a reduction made to the invoice if the buyer pays the invoice prior to a set date.
