What do u mean by discount on debtors- nbsp-

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Byju's Answer

Standard XI

Accountancy

Advantages of BRS

what do u mea...

Question

what do u mean by discount on debtors?

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Solution

Discount allowed to debtors when they make prompt payment is termed as Discount on Debtors. It is an expense for the business & its accounting procedure is same as that for Provision for doubtful debts.

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Similar questions

What is meant by provision for discount on debtors?

What is the reason for the creation of a provision for discount on debtors?

Q. While preparing final account, to make provision for discount on debtors. which of the following adjustment entry will be passed?

Provision for Discount on Debtors A/c To Debtors A/c	Dr.
Profit & Loss A/c To Provision for Discount on Debtors A/c	Dr.
Provision for Discount on Debtors A/c To Trading A/c	Dr.
Debtors A/c To provision for Discount on Debtors A/c	Dr.

Debtors: Rs. 30,000. Bad debts: Rs. 300, provision for bad debt 5% on debtors, discount on debtors 2%.
Calculate the correct amount of provision for discount on debtors.

What is the correct accounting adjustment entry to record provision for discount on debtors?

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