Question

What is trade discount and cash discount. ​

Answer 1

Answer:

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 is offered on the list price or the catalog price that the buyer sees at the time of purchase. The list price gets reduced by a certain percentage depending on the quantity purchased. Cash discount is offered to the buyer on the invoice or billed price of the goods and services.




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