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What is the Difference between trade discount and discount allowed?
trade discount is for trade customer (who has an account with the supplier) discount allowed is for walk in customers (no account holders)
What is the difference between discount given and discount received?
nothing there the something ...
You received a 20 percent discount off of 21.96 What is the original price?
$26.35
What is the Difference between trading discount and discount allowed?
Discounts may be offered on sales of goods to attract buyers. Discounts may be classified into two types:Trade Discounts: offered at the time of purchase for example when goods are purchased in bulk or to retain loyal customers.Cash Discount: offered to customers as an incentive for timely payment of their liabilities in respect of credit purchases.Trade DiscountTrade discounts are generally ignored for accounting purposes in that they are omitted from accounting records. Therefore, sales, along with any receivables in the case of a credit sale, are recorded net of any trade discounts offered.ExampleBike LTD as part of its sales promotion campaign has offered to sell their bikes at a 10% discount on their listed price of $100. Sale revenue and any accounts receivable will be recorded net of trade discount, i.e. $90 per bike.Cash DiscountCash discounts result in the reduction of sales revenue earned during the period. However, not all customers may qualify for the cash discount. It is therefore necessary to record the initial sale and receivables at the gross amount (after deducting any trade discounts!) and subsequently decreasing the sale revenue and accounts receivable by the amount of discount that is actually allowed. Following double entry is required to record the cash discount:DebitDiscount Allowed (income statement)CreditReceivableDebiting discount allowed ledger has the effect of reducing gross sales revenue by the amount of cash discount allowed. Consequently, receivables are credited to reduce their balance to the amount that is expected to be recovered from them, i.e. net of cash discount.ExampleBike LTD as part of its sales promotion campaign has offered to sell their bikes at a 10% discount on their listed price of $100. If customers pay within 10 days from the date of purchase, they get a further $5 cash discount. Bike LTD sells a bike to XYZ who pays within 10 days. Before we proceed with the accounting entries, it is necessary to first distinguish between the two types of discounts being offered by Bike LTD. The 10% discount is a trade discount and should therefore not appear in Bike LTD's accounting records. The $5 discount is a cash discount and must be dealt with accordingly.The initial sale of the bike will be recorded as follows:$$DebitXYZ (receivable)90CreditSales90As XYZ qualifies for the cash discount, the following double entry will be required to record the discount allowed:$$DebitDiscount Allowed (income statement)5CreditXYZ (receivable)5The above entries have resulted in sales of Bike LTD being reduced to $85 (100-90-5). The receivable from XYZ has also been reduced to this amount effectively. wriiten by nana tweneboah kodua (prisdark academy)
What is the Present value of 700 to be received in two installments of 350 two years from today at a discount rate of 10 percent?
i think the present of 700 is 700%
What is the difference between discount allowed and discount received?
discount allowed means the discount which is given by a seller to the buyer. and discount received means the discount received by the seller for purchases made
What is the difference between discount allowed and discount received and their accounting treatment?
Discount allowed is that amount which is given by our company to others while discount received is that amount which is received by our company from others.while discount allowedDebit discount allowedCredit cashwhile discount receivedDebit cashCredit discount received
Is discount allowed and discount received are same as credit note issued and credit not received?
no because the discount allowed and discount received are totally diffrent and has no link with each other where as if credit note is not issued than it cant received even
How are percents used in advertising and sales?
Discount allowed/ received
Where does sales discount go on an income statement?
does discount allowed and discount received go into the income statement or balance sheet?
Discount received from the supplier or allowed to customer for making the early payment of due is termed as..?
Trade Discount
What is double entry treatment of DISCOUNT Allowed and Received?
Discount allowed: original entry made in the discount allowed column on the debit side of the cash book and at the end of the month debited(after balancing the cash book) in the nominal ledger. The credit entry is made in the personal account of buyer. Discount received: original entry made in the discount received column on the credit side of the cash book and at the end of the month credited(after balancing the cash book) in the nominal ledger. The debit entry is made in the personal account of seller.
What is unexpired discount?
Its a personal account
How do you treat discounts allowed and received in the income statement?
Discount allowed is an expense,take an example if one makes a cash sale and offers a cash discount,it reduces the cash paid and thus accounted for as an expense,a Discount received is treated as a revenue because take an example if one buys goods and pays cash and the person selling grants a discount,it reduces the amount paid and thus an added revenue,the difference on what i paid and what was ought to be paid,its always given in percentage,with set conditions.Types of discounts can be trade or cash both allowed and received.
How do you pass journal entry for discount allowed?
Debit cash / bankCredit discount allowed
Does discount allowed have a debit or credit balance in the ledger balance?
Discount allowed is debit
What is the Difference between trade discount and discount allowed?
trade discount is for trade customer (who has an account with the supplier) discount allowed is for walk in customers (no account holders)
