Explain about trade discount, Accounting Basics

Assignment Help:

Q. Explain about trade discount?

A trade discount is a percentage deduction or else discount from the specified list price or catalogue price of merchandise. Companies utilize trade discounts to

- Decrease the cost of catalogue publication. A seller is able to use a catalogue for a longer time by printing list prices in the catalogue and giving separate discount sheets to salespersons whenever prices change.

- Allowance quantity discounts.

- authorize quotation of different prices to various customers such as retailers and wholesalers. The seller's invoice may demonstrate trade discounts. But sellers don't record trade discounts in their accounting records because the discounts are used only to calculate the gross selling price. Nor do trade discounts emerge on the books of the purchaser. To illustrate suppose an invoice contains the following data

2359_Explain about trade discount.png

The seller files a sale of USD 3360. The purchaser files a purchase of USD 3360. Therefore neither the seller nor the purchaser enters list prices and trade discounts on their books.


Related Discussions:- Explain about trade discount

T-accounts general ledger, trying to put the numbers into the correct asset...

trying to put the numbers into the correct asset t-account and not adding up

Accounting entity assumption and matching principle, 1. For each of the fol...

1. For each of the following accounting assumptions/principles, explain a business transaction:   (a) Accounting Entity Assumption (b) Going Concern Assumption (c) Matching Prin

Describe about net sales, Q. Describe about Net sales? Sales -- amounts...

Q. Describe about Net sales? Sales -- amounts received or due for services or goods sold to customers. Gross sales aretotal sales before any returns or adjustments. Net sales a

Explain about period costs, Q. Explain about Period costs? Period costs...

Q. Explain about Period costs? Period costs are costs not noticeable to specific products and expensed in the period incurred. Administrative and Selling costs are period costs

A firm has $200, A firm has $200,000 in total assets and $120,000 in owner'...

A firm has $200,000 in total assets and $120,000 in owner's equity. What are the total liabilities? A. $80,000 B. $200,000 C. $320,000 D. Cannot be determined from the info

Explain journal entry, Q. Explain journal entry? A journal is a sequent...

Q. Explain journal entry? A journal is a sequential arranged in order of time record of business transactions. A journal entry is the stacking of a business transaction in the

The following financial data were taken from the annual, Based on the finan...

Based on the financial statements for Jackson Enterprises (income statement, statement of owner's equity, and balance sheet) shown below, prepare the following financial ratios. Al

Miss, what is the implications of applying accounting concepts wrongly

what is the implications of applying accounting concepts wrongly

Business transactions and the accounting equation, Business transactions an...

Business transactions and the accounting equation A transaction is any activity which changes the value of a firm's assets, liabilities or owner's equity. Every transaction

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd