The Discount Lost account is used when the:
A) gross method is used and the discount is not taken.
B) gross method is used and the discount is taken.
C) net method is used and the discount is not taken.
D) net method is used and the discount is taken.

Question

Quizplus · Accepted Answer

The Discount Lost account is used under the net method when the discount is not taken. This method assumes discounts will be taken and records purchases at the net amount. If the discount is not taken, the difference is recorded in the Discount Lost account, indicating an expense incurred for not taking advantage of the discount.

The Discount Lost Account Is Used When The