The discount column on the left-hand side of cash book represents a discount

JAMB Accounting 2023 53 views

The discount column on the left-hand side of cash book represents a discount

  1. received from a creditor
  2. allowed to a debtor ✓
  3. received from a debtor
  4. allowed to a creditor

Explanation

The left side of the cashbook is the debit side, recording money received from debtors. When debtors pay early, you allow them a discount. This discount appears in the left column.

Discount received from creditors appears on the right (credit) side because that’s where you record payments to suppliers. Debtors give you money, they don’t give you discounts.

Remember: Left side = debtors paying you, you allow discount. Right side = you paying creditors, they allow discount.

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