What is difference between trade discount and cash discount?

Explanation

Trade Discount


1.It is the kind of discount that's offered by the vendor to the customer as a discount within the value of the merchandise


2.Accounting treatment Not shown in any books of accounting, reduction adjusted with final value and also the discounted value is other to record books


3.When discount is allowed At the time the acquisition is formed


Cash Discount


1.This discount is obtainable by the vendor to the client on the invoice quantity at the time of constructing payment among the stipulated time


2.It is properly recorded within the books of each purchaser and trafficker. Recorded in profit Associate in Nursingd loss statement as an expense


3.When discount is allowed It is allowed at the time of payment