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    Jeanne Arcand's Avatar
    Jeanne Arcand Posts: 4, Reputation: 1
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    #1

    Oct 18, 2008, 07:46 PM
    Purchase discounts/allowances GL
    Hi,

    Can I use the same GL for purchase discounts and purchase allowances? What is the difference?

    Thanks

    Jeanne
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
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    #2

    Oct 22, 2008, 01:28 PM

    Yes you can use the general ledger for these transactions.

    A purchase is discount is a discount that is received when you pay your bill within a certain amount amount of time.

    For example your invoice states 2/10 net 30.
    This means you can take a 2% discount if you pay your bill within 10 days. If not you pay the full amount. If your bill is for $1,000 if you pay within the 10 day period you will pay $980.

    The other account is called Purchase Returns and Allowances and it is used when you return all or part of your puchases.
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