[GNC] Credit Card Rewards Refund

[Adrien Monteleone]

I know a business with plenty of vendors who still offer 2/10 Net30 
terms. (furniture industry)

Since the 2% is deducted from the payment, the expense is directly 
reduced by a contra-account 'Discounts and Allowances'.

I don't recall any cases where full payment had to be rendered and then 
the 2% discount credited later, but I would imagine the accounting would 
be the same, with the credit simply applied to a future invoice.

Regards,
Adrien

On 10/15/21 11:15 AM, Michael or Penny Novack wrote:
> Perhaps historical perspective might help, especially with businesses, 
> because might want to treat the same way as when invoices typically were 
> like this, except conditional on when paid.
> 
> I have no idea how accrual treats this (would have treated this) when in 
> the old days a vendor might send an invoice like this:
> 
> Immediate, 2% discount, 30 days net, else 1% per month.
> 
> I am old enough to remember those days. Assuming the accrual system 
> treated the "30 days net" as normal, what was done if paid immediately? 
> That closely resembles the situation of credit card rebates on 
> purchases. As to the argument wanting to  distribute to reduce all 
> expenses  paid during that billing period, is that also being done in 
> reverse with interest charges (if any -- often a business credit card is 
> not intended as a source of credit and balance paid each month -- and 
> SOME people ca manage that with their personal credit cards too)
> 
> 
> Michael D Novack