A cash discount is a reduction in the invoice amount offered to customers to encourage early payment. By offering this discount, businesses can enhance cash flow and reduce the risk of non-payment.
In the realm of accounting, a 'discount' refers to a variety of reductions applied to amounts due or outstanding, impacting both operational transactions and financial statements.
A sales discount, also known as a cash discount, is a reduction in the price of a product or service that is offered by the seller to buyers as an incentive for prompt payment.
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