How To Record Discounts In Accounting - Definition And Meaning - Explanation
What is Discount In Accounting? | Accounting Treatment Of Different Types Of Discounts It is an allowance given to buyers to influence them to buy goods / products or services at cheaper prices. Ultimately, it increases the Sales of the business. Recording of it in Accounting depends upon different types of discounts. The main types of discounts are Purchases Discount , Sales Discount , Discount Received, Discount Allowed, Cash Discount and Trade Discount. N ow, we will discuss about the journal entries related to these specific types. For Purchases Disc. , we record the following entry as shown below: Accounts Payable a/c XXX ...