what is the difference between discount and allowance ?

1 ANSWERS

1. Guest3455
   

    Discounts and allowances are basically the reductions to a basic price of goods or services. It is simply the difference between the original amount owed in the present and the amount that has to be paid in the future to settle the debt.
   
   An allowance can be earned in some way such as it can be given if there is something wrong with the merchandise, or to show customer that you value their business. While discount is the reduction in price to help sell your product and it is put up for a specified time. Sales Discount is a contra Revenue account Subtracted from Sales Returns /Allowance to arrive at Net Sales.

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