Discount
This query is : Resolved
SAMIR KUMAR PATI
(Querist)
09 April 2012
what would be the accounting treatment for the quantity discount i received on purchase of goods.
10 April 2012
Dicount is your income and you have earned it this can be shown in 2 ways either you reduce the cost of the goods by Debiting the Party in case no payment is receive or Bank in case of payment is received and credit Purchase account. Alternatively you can directly book the same as income by debiting party or Bank and crediting Discount.
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CA Kishore Tallam
(Expert)
10 April 2012
If it is a quantity / trade discount, it should be reduced from the cost of the goods purchased. If it is a cash discount, then this can be shown as income.
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