1. Meaning ↓
Trade Discount is a discount allowed past times the seller to the buyer inward illustration of mass purchases made past times him.
Cash Discount is a reduction inward the cyberspace sum payable past times the buyer when prompt payment is made past times the buyer.
2. When Allowed?
Trade discount is commonly allowed when mass purchases are made.
Cash discount is commonly allowed if payment inward cash is made promptly i.e. inside a curt catamenia of time.
3. Purpose or Objective ↓
Trade discount's object is to attract bigger orders past times giving incentive to the buyer to purchase more.
Cash discount's occupation is to encourage the buyer to brand prompt payment.
4. How Calculated?
Trade discount is calculated equally a percent of the catalogue price.
Cash discount is calculated equally a percent of cyberspace sum payable past times the buyer.
5. Variation inward Rate ↓
Trade discount charge per unit of measurement varies according to the type in addition to quantity of goods purchased.
Cash discount varies according to the catamenia of payment.
6. Entry inward the Books of Accounts ↓
Trade discount does non seem inward the books of accounts.
Cash discount is recorded inward the books of accounts.
