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Trade Discount

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Trade Discount
The amount by which a company reduces its price per unit when selling units (usually in large quantities) to a reseller. Trade discounts exist to encourage large orders, which, while they may reduce profit margin, increase revenue and therefore raw profit. They also tend to increase the reseller's profit margin, which may encourage repeat business with the supplier.


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Many of the larger industrial supplies companies also offer member discounts or trade discounts for repeat business on many of their products.
The university's traditional furniture procurement system was replaced with the Office of Government Commerce framework which secured greater trade discounts, designer furniture for the Design School and better warranties.
2007-53 allows qualifying taxpayers to account for certain advance trade discounts for federal income tax purposes in the same way that they are accounted for in the taxpayer's financial statements * In substance, an advance trade discount is an adjustment to the purchase price of goods and should be treated for tax purposes as a reduction of inventory costs.
 
 
 
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