If creditors are paid within the discount period,the current treatment required by the accounting standards for the discount received is to:
A)debit the Discount received account.
B)credit the Discount allowed account.
C)credit the Inventory account with the net settlement discount.
D)No entry is required.

Question

Quizplus · Accepted Answer

When creditors are paid within the discount period, the discount received is credited to the Inventory account, reducing the cost of inventory, as per accounting standards.

If Creditors Are Paid Within the Discount Period,the Current Treatment