When you, as a supplier, offer a discount to your customer, it’s categorized as an expense. Conversely, if you receive a discount from your supplier, it’s regarded as income.

In BizCentric, discount allowed or received is not booked separately. Usually, the invoice’s final discounted amount is recorded. However, if you prefer to document discounts separately, you can proceed as follows:

1) “Discount Allowed” is a type of Expense and “Discount Received” is a type of Income. Hence, first create these two accounts in the Chart of Accounts.

2) Create an invoice, select the item. Now, under the “Sales/Purchase Taxes and Charges” table, select the discount account head depending on the transaction, and enter the discount rate as a negative value.

3) Proceed to making the final payment via Payment Entry.

Note: The identical procedure can be applied when generating a Purchase Invoice. However, in this scenario, the account chosen in the Purchase Taxes and Charges table will be “Discount Received,” categorized as an income account.