By Madhupriya
November 29,2022
Metalnation.org
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Sales returns and allowances are a sales deduction that shows the sale price of goods returned by customers as well as discounts taken by them to retain defective goods.
Metalnation.org
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What are the 3 types of discount?
When a discount is given to the buyer, it is recorded as a reduction in the expense (or asset) associated with the purchase, or in a separate account that tracks discounts.
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Is discount an expense or liability?
A discount allowed is a reduction in the price of goods or services granted by a seller to a buyer that is incurred by the seller.
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Is discount income or expense?
In general, discounts are reductions granted for debt settlement. (2) Compensation. Allowances are deductions made for damage, delay, shortage, imperfection, or other reasons, but do not include discounts or returns.
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1 The after-tax cash flows to equity holders are discounted at the cost of equity using the CFE method. The WACC method depreciates after-tax cash flows at the weighted average cost of equity (E) and debt (D) (D).
Metalnation.org
Metalnation.org