Cash discount is provided on ................ (a) prompt payment (b) sales (c) purchases (d) None of these
Answers
Answer:
b
Explanation:
Among the various options given in question statement, cash discount is provided on the purchases done by the customer. When preparing a bill, the total amount is reduced by the cash discount. It does not depend on the payment or sales rather it is applicable to what products have been purchased and what is the cash discount on each.
Answer: (c) purchases is the correct answer
Explanation:
Cash discount is provided on purchases.
Whenever we buy any item, we get discount on that particular item which is the purchase made by the buyer.
A cash discount is a lucrative approach to sell more products by the seller to the buyer.
Cash discounts are also given in order to recover payments speedily without delay. Also, cash discounts prompts a seller access to the cash sooner than if no discount was offered initially.
Hope it helps!
#MVB