Question
Exe Co, which purchased 50 computers from HCL made payment immediately. As a result, HCL granted it a discount of ₹ 10,000. Is the discount received Trade Discount or Cash Discount? How will you record it in the books of account?

Answer

Discount allowed by HCL is a Cash Discount. It is recorded in the books of account by crediting it to ‘Discount Received Account'.

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