Question

discount allowed to m/s sen and pandit 3000​

Answer 1

Answer:

Discount allowed acts as an additional expense for the business and it is shown on the debit side of a profit and loss account. Trade discount is not shown in the main financial statements, however, cash discount and other types of discounts are supposed to be recorded in the books of accounts.

In case of a transaction where both trade discount and cash discount are allowed, the trade discount is allowed first and then the cash discount is processed.

Answer 2

Answer:

trade discount will only be reduced but there is no entry while cash discount has to be deducted and has a particular entry in book of account i.e, Journal

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