A trade discount is:
A) A term used by a purchaser to describe a cash discount given to customers for prompt payment.
B) A reduction in price below the list price.
C) A term used by a seller to describe a cash discount granted to customers for prompt payment.
D) A reduction in price for prompt payment.
E) Also called a rebate.

Question

Quizplus · Accepted Answer

A trade discount is a reduction in the listed price of a product or service offered by a seller to a buyer, typically for bulk purchases or to members of a particular group. It is not the same as a cash discount, which is offered for prompt payment, nor is it a rebate, which is a return of part of the purchase price after the sale has been completed.

A Trade Discount Is