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Hi Sir,
I have a question about Receivables and payables and was wondering if you could help me with. This is a question from BPP revision kit 11.7.
11.7 What is the correct double entry for discounts received?
The correct answer is —- Debit: Payable control account
Credit: Discounts received (income)I understand the credit entry, but not sure about the Debit entry is made on payable control account.
Thanking you in advance.
You receive discounts from suppliers, and therefore the discount reduces the amount owing to the supplier. The amount owing is a credit balance on payables and therefore to reduce the amount owing we debit the payables account.
This is all explained in my free lectures. The lectures are a complete free course for Paper FA and cover everything needed to be able to pass the exam well.
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