Discount

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Sandeep Kumar (Querist)
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26 August 2013 sir
our co. purchase a car of rs. about 40.00 lacs and they give us a discount about 2 percent. my quires is that how I enter this discount in my books. can I consider this as a income. please suggest me through a example of that type of entry...

Dintakurthi Tirumala

Dintakurthi Tirumala (Expert)
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26 August 2013 If you getting discount at the time of purchasing of asset then it is called as Trade Discount and you have to consider the value of asset(purchase value) net of discount amount.

In case if you getting this discount at the time of payment i.e means you purchased the car for payment of installment basis and for prompt payment company allowing you discount then it is called cash discount then you have to considered it as Income.

OM SAI SRI SAI JAI JAI SAI

Sandeep Kumar

Sandeep Kumar (Querist)
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26 August 2013 sir we paid the 15.00 lacs in advance and 25 by finance. how shall we know/consider that this a trade discount or cash discount. please reply.

Dintakurthi Tirumala

Dintakurthi Tirumala (Expert)
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26 August 2013 I.e means you totally paid Rs. 40 along with finance amount.

Is you know about the discount amount at the time of purchase and it shall be allowed by the company at the time of purchase then it shall be treated as trade discount.

OM SAI SRI SAI JAI JAI SAI

Sandeep Kumar

Sandeep Kumar (Querist)
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26 August 2013 that means we can deduct that discount amount form the company bill.

Dintakurthi Tirumala

Dintakurthi Tirumala (Expert)
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26 August 2013 Yes, you have to deduct it from invoice value or purchase value. Before that please keep in mind is seller given any document or credit note etc.. for evidence of discount allowed.

OM SAI SRI SAI JAI JAI SAI

Sandeep Kumar

Sandeep Kumar (Querist)
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26 August 2013 sir
I asked the ledger from the car showroom. I seen that discount amount in this leger.
then I can deduct that amount form invoice value.

Dintakurthi Tirumala

Dintakurthi Tirumala (Expert)
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26 August 2013 First of all please give me the following information

1) What is the value as per the Invoice
2) how much amount you paid
3) If possible please send the scanned copy of invoice and ledger copy from company to my mail id sairam_tirumala@rediffmail.com ( if you want and have reliable on me and feels requirement).
4) Otherwise please indicate is any discount amount mentioned on the the invoice.

why because i asked the copies there is some disturbance between providing information by you and understanding of facts etc..

OM SAI SRI SAI JAI JAI SAI

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