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Buy nowthere are two kinds of vendor discounts
bulk ordering discount where you get a better price per each when ordering in volume, called a sales discount and you do not book it separately, the actual cost of the items is entered.
early payment discount, you pay early like in 2/10/net 30 terms. That is your income, so on the bill enter your income account and a negative amount, then pay the balance due.
there is no actual set up for this that I am aware of
I am wondering if the Discount Account for a Vendor Discounts should be an expense or income? Can you tell me which one it should be? My company currently has it has an expense.
Hello there, youngerbroslumber.
A vendor discount means you paid less than what was owed. It should reduce the cost of what was paid for, BUT QB is incapable of doing that. As a result, the discount amount is, or should be, posted as income to the company.
Vendor discounts help the vendor get his money quicker, but it does add income to your company - your choice.
I'm adding this article with the topics you can use while recording the common vendor transactions: The Difference Between Bills, Checks, and Expenses in QuickBooks Online.
It'll always be my pleasure to help if you've got additional questions about discounts and payments. Use the Reply option below and surely I'll be here ready to assist you. Take care and stay safe!
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