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Treatment of Turnover target based Discount

RAHUL SHAW (47 Points)

09 April 2021

Dear senior

Please provide accounting & tax treatment of discount received for target turnover.

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5 Replies

CA. Sourav Sarkar (Chartered Accountant ) (24578 Points)
Replied 09 April 2021

Discount Received should be deducted from turnover.
Discount received should be shown under indirect income in profit and loss account.

Discount received a/c dr
to Profit and loss a/c

Sales a/c dr
to Discount received a/c

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Mujeeb Doi (309 Points)
Replied 10 April 2021

If the discount is received on bills already paid for and discount is received in cash then,
cash/bank a/c dr. ....... to discount received a/c(P&L)

If the discount is received on bills still not paid,
then,
Creditors A/c Dr............ to discount received a/c (P&L)