Difference between trade discount and cash discount ?
|BASIS OF DIFFERENCE||TRADE DISCOUNT||CASH DISCOUNT|
|MEANING||It is defined as discount given by seller to buyer as deduction in list price of the product.||It refers to deduction in amount of sales allowed by seller to pu.rchaser for immediate payment|
|PURPOSE||To encourage bulk sales||to facilitate prompt payment|
|DISCLOSURE||It is not recorded in books of accounts||It is shown in books of accounts|
|TIME OF DISCOUNT||At time of sale||At time of payment|