- A. carriage inwards
- B. carriage outwards
- C. discounts allowed
- D. discounts received ✓
Discounts received are considered as income for a business and are recorded as a credit entry in the profit and loss account. When a business receives discounts from its suppliers or other entities, it reflects as a positive impact on the financial performance of the company.
In other words, a credit entry in a profit and loss account represents income or gains for the business. In this case, an example of a credit entry would be “discounts received.” When a business receives discounts from suppliers or other parties, it is recorded as income in the profit and loss account.
“Discounts received” is considered a credit entry because it increases the overall income of the business. This type of entry reflects a positive impact on the financial performance of the company, as it represents savings or benefits received by the business.
In contrast, “discounts allowed” would be a debit entry in the profit and loss account. This is because discounts allowed represent a reduction in revenue or income for the business, leading to a decrease in overall profitability.
