Question

what is a trade discount and cash discount ​

Answer 1

Explanation:

Trade discount is given on the catalogue price of the goods while the cash discount is given on the invoice price. Trade discount is granted with the aim of increasing the sales in bulk quantity, whereas Cash discount is granted to facilitate a quick payment. A trade discount is shown as a deduction in the invoice.

Answer 2

TRADE DISCOUNT

A trade discount is a routine reduction from the regular, established price of a product. The use of trade discounts allows a company to vary the final price based on each customer's volume or status. ... Trade discounts are not recorded in a separate account by either the seller or the buyer.

CASH DISCOUNT

Cash discounts refer to an incentive that a seller offers to a buyer in return for paying a bill before the scheduled due date. In a cash discount, the seller will usually reduce the amount that the buyer owes by either a small percentage or a set dollar amount.