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What is difference between trade discount and cash discount?

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प्रश्न

What is difference between trade discount and cash discount?

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उत्तर

Basis of Difference Trade Discount Cash Discount
Meaning It is allowed when goods are purchase or sold. It is allowed at the time of payment.
Recording in books It is recorded in invoice/bill but not in the books. It is recorded in the discount column of the Cash Book's debit side, if allowed, and credit side, if received.
Purpose It is allowed to increase sale. It is allowed for earlier payment.
Deduction It is deducted from the price-list of the goods. It is not deducted from the
price list of the goods.
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पाठ 4: Recording of Transactions - II - Questions for practice [पृष्ठ १५२]

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एनसीईआरटी Accountancy Financial Accounting Part 1 and 2 [English] Class 11
पाठ 4 Recording of Transactions - II
Questions for practice | Q 9 | पृष्ठ १५२
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