What Is a Sales Discount?

Sales discount is a discount on merchandise sales, which refers to a kind of price discount given to purchasers in order to promote the goods and recover the sales payment as early as possible in the case of credit sales and commercial credit. Sales discounts are divided into commercial discounts and cash discounts. Commercial discount refers to the issue of invoices by the enterprise according to the marked retail price of the goods, and then a certain discount to the wholesale and retail links in the circulation field. According to business habits, commercial discounts are deducted directly from the price list price. The amount of money payable by the buyer and receivable by the seller is calculated based on the sales price after deducting the commercial discount, that is, the sales of the seller. The income is calculated and reflected at the price after the commercial discount. Therefore, the commercial discount does not have the problem of adjusting the operating income. Cash discount means that when an enterprise sells goods on credit, in order to encourage the buyer to pay for the goods early within a certain period (credit period), a discount period shorter than the credit period is often specified. If the buyer pays within the discount period, You can get a certain cash discount, which is to deduct a certain percentage of the total payment. For the seller, a sales discount is a cash discount. Sales discounts do not represent expenses incurred to provide goods or services. If the customer receives such a discount, the net value represents the true price of the item and service sold. Therefore, sales discounts should be used as a discount item for revenue, not as a depletion of income-generating assets. There are two methods for the calculation of cash discount: one is the full price method, that is, the operating income is reflected at the full price, and the actual cash discount is deducted from the operating income; the second is the net method, that is, the operating income is based on the actual cash discount. The net amount reflects. The new corporate accounting system takes the former approach. ^[1]

Sales discount

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Sales discount is a discount on merchandise sales, which refers to a kind of price discount given to purchasers in order to promote the goods and recover the sales payment as early as possible in the case of credit sales and commercial credit. Sales discounts are divided into commercial discounts and cash discounts. Commercial discount refers to the issue of invoices by the enterprise according to the marked retail price of the goods, and then a certain discount to the wholesale and retail links in the circulation field. According to business habits, commercial discounts are deducted directly from the price list price. The amount of money payable by the buyer and receivable by the seller is calculated based on the sales price after deducting the commercial discount, that is, the sales of the seller. Revenue is calculated and reflected at the price after the commercial discount. Therefore, the commercial discount does not have the problem of adjusting operating income. Cash discount means that when an enterprise sells goods on credit, in order to encourage the buyer to pay for the goods early within a certain period (credit period), a discount period shorter than the credit period is often specified. If the buyer pays within the discount period, You can get a certain cash discount, which is to deduct a certain percentage of the total payment. For the seller, a sales discount is a cash discount. Sales discounts do not represent expenses incurred to provide goods or services. If the customer receives such a discount, the net value represents the true price of the item and service sold. Therefore, sales discounts should be used as a discount item for revenue, not as a depletion of income-generating assets. There are two methods for the calculation of cash discounts: one is the full price method, where operating income is reflected at the full price, and the actual cash discount is used to deduct the operating income; The net amount reflects. The new corporate accounting system takes the former approach. ^[1]

Chinese name

Sales discount

Foreign name

Sales discount

the way

Refers to the use of credit sales

Opposition

Business discount

The opposite of discount sales is commercial discount, which means that the company issues an invoice based on the retail price of the product, and gives the buyer a certain percentage of the sales discount on this basis. It also means that when the seller sells goods or taxable services, due to the purchaser's large purchase quantity or frequent purchase behavior, the buyer is given a preferential price.

It can be understood in a simple way. Sales discounts are sales discounts that are given to encourage purchasers to pay as soon as possible within the credit period after the sale occurs.

Discount sales, which are discounted first and then sold, are deducted from the list price of the product by the enterprise to promote sales, and later sales occur. Literally, discount sales can be simply referred to as "discounts"!