Discount under the sal Discount under the salv Above the sales discount as a contra revenue account appears as a duction of from the gross income of report by Company ABC which results in net income of . Also read Promotional Costs Meaning Types Examples How to Calculate and Journals Example of sales discount journal To illustrate another example of a sales discount assume that a manufacturer sells worth of product to its customers and its crit terms are n. This given condition means that the customer can fulfill the obligation of if he pays sales discount within days.
Another alternative is for Discount under the sal
The customer to pay the full within days. Now Indonesia WhatsApp Number List if the customer pays within days the manufacturer will record the transaction as follows Account DEBIT CRIT Cash Ac Ac sales discount To accounts receivable Ac Journal entry for payment of receiv from customer after providing discount When reporting it on the income statement the revenue section will look like this Gross sales Minus sales discount Net sales As seen in the financial statement above the sales discount as a contra revenue account appears as a duction of from.
The gross income of report
By the manufacturer resulting Malaysia Phone Number List in net income of . Also read Maintenance Costs Examples How to Calculate and Journals in Accounting Conclusion Sales discounts are a type of contra account that offsets revenue. This means that the expect sales discount balance is opposite to the usual crit balance in the revenue account. As a contra revenue account sales discounts on the income statement are report on a line call Less Sales revenue line. This value appears near the top of the income statement as a duction from gross revenue and is thus record in a contrarevenue account call sales discount.
