In the books of seller, is deducted from the invoice price when the buyer pays earlier or on the date/term stipulated

Business

1 answer:

Nutka1998 [239]3 years ago

7 0

Answer:

In the books of seller, cash discount is deducted from the invoice price when the buyer pays earlier or on the date/term stipulated

Explanation:

An early payment discount or cash discount is the reduction in invoice price due to payment before the due date.
A number of factors should be considered to see how much discount should be provided . Some of them are: check the cash discount offered by competitors, and check the payment history of the customer.
This strategy helps close the gap in cash flow and boost the working capital.

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