After selling the goods on a credit basis the debtors may be given certain deduction in amount due in case if they pay the amount within the stipulated period or earlier.
This deduction is given at the time of payment on the amount payable.
Hence, it is called a cash discount.
Cash discount acts as an incentive that encourages prompt payment by the debtors.
It varies with the time period.
Tag:11accounts, 11commerce, 11economics, 11thcommerce, 12accounts, 12commerce, 12economics, 12thCommerce, BComAccounts, BESTCOMMERCEANDACCOUNTANCYPLATFORM, CAFinalAccounts, CAfoundation, CAfoundationAccounts, CAfoundationEconomics, CAfoundationLaw, CAHARSHITA, CAInterAccounts, cash discount, commerceachiever, commerceoptional, discount, Economics, economicsclass12, Equity Theory, gLOSSARY OF hrm, GST, HR Glossary, Human Resource Accounting, incometax, mba hr, mba hr notes, MComAccounts, NCERT, ncertcommerce, tax, UGCNETCommerceOptional, UPSC COMMERCE OPTIONAL BOOKS, UPSC Commerce Optional Material, UPSC COMMERCE OPTIONAL PDF, UPSC Commerce OPtional Previous Year Paper Solution, UPSC Commerce Optional Previous Year Papers, UPSCcommerceOptional, UPSCoptional