To illustrate, let's assume that your company receives marketing consulting services and is billed $10,000 with terms of 1/10, net 30. If the bill is paid within 10 days, the cost is $9,900 ($10,000 minus the 1% discount of $100). This means that Cash should be credited for $9,900 and that the account Marketing Consulting Expenses should be debited $9,900. The cost of the marketing services was the cash price of $9,900.
It would be wrong to record $10,000 as a debit to Marketing Consulting Expenses and to record a credit of $100 in the account Cash Discounts. The reason is that the Cash Discounts is usually intended to be a contra account for Purchases, which is used by companies that purchase goods for resale.
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