Income statement

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Cundy27_uk
Cundy27_uk Registered Posts: 4
in Synoptic Assessment - Foundation
Where do disc allowed go on income statement? Would I put them under expenses or liabilities??
Also I have a debit cash and credit bank, how would I enter this on statement of financial position??

Thanks

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  • Clintm15
    Clintm15 Registered Posts: 248 Dedicated contributor 🦉
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    An income statement only has 'income' and 'expenses', the statement of financial position has 'assets' and ' liabilities'.

    Discounts allowed are contra income, so they operate like expenses.

    If you debit cash and credit the bank, you are withdrawing money from the bank. So bank decreases and cash increases.
    AAT
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  • ashakantasharma
    ashakantasharma Registered Posts: 1
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    Any kind of Discount allowed to customers is Expense for the business organisation and will come in Income Statement (Profit & Loss Account of the business organisation)
  • cjkearns
    cjkearns Registered Posts: 11
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    Please remember DaD and DrC.
    DaD is Discounts Allowed Debit.
    DrC is Discounts Received Credit.
    Literally, just say dad and doctor C in your head when you see them and I promise they will stick in your head.

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