Question

purchased goods from harish ₹12000 @7% T.D. What is The amount of trade discount​

Answer 1

Answer:

12000*7% = 840

trade discount amount

Answer 2

The amount of trade discount is ₹840.

Explanation:

• Sometimes when the goods are purchased in large quantities, the seller gives a trade discount to the buyer.
• A trade discount is a discount/reduction on the list price of the goods when bought together in bulk quantities.
• However, as trade discount is calculated on the list price, it is not shown in the main books of account. It is only calculated and deducted from the price.
• Here Harish purchased goods for ₹12,000 @7% trade discount. So discount will be given at the list price of ₹12,000
• Trade discount = ₹12,000 * 7/100 = ₹840
• This trade discount will be deducted from the list price before entering into the journal.