A trade discount that is granted as an incentive for a first-time customer or as a reward for large order should be accounted for by the purchaser as revenue.

Name: A trade discount that is granted as an incentive for a first-time customer or as a reward for large order should be accounted for by the purchaser as revenue.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

A trade discount granted as an incentive or reward is deducted from the purchase price, so it reduces the cost of the goods purchased rather than being accounted for as revenue.

A Trade Discount That Is Granted as an Incentive for a First-Time