• Registered: 11/14/2010
  • Posts: 11

Topic: discount in gl

i am new to accountancy,and  i would like to know and clear my doubt why the''' discount given '''  in chart of accounts is under  receivables.and the''' discount received '' under payables.is it not the other way.when the company give some percent /amount as discount , it has a negative impact on company income,so it should be in expense part. like wise when vendors give discount to company, it is a gain ,so it should go to receivables. kindly any body give a proper clearance.thanks in adwance

  • joe
  • Administrator
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  • Registered: 03/15/2007
  • Posts: 5,107

Re: discount in gl

If you sell items with a discount, it is called discount given (from your point of view). So on payment this discount given goes in debit.
If you get a discount on payment to supplier, it is cfalled discount received (from your point of view). Therefore this discount received goes in credit.

/Joe