trade discount


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Related to trade discount: cash discount

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.

trade discount

see QUANTITY DISCOUNT.

trade discount

see DISCOUNT.
References in periodicals archive ?
Presumably, this means that the entire advance can be treated as a trade discount unless a portion of it is carved out as nonrefundable.
It was not possible to identify the purpose of the trade discount for this analysis.
When it came to paying for the peroxide, a young Asian woman Asiedu was with produced a 'Sally's Card' and she gave them the trade discount which reduced the price per litre from pounds 2.
Therefore, in this scenario, the annual net savings is the trade discount savings minus the cost of borrowing the money:
Memo 1996-131, holding that Sun's purchaser must treat the redemption of the warrants as a trade discount that reduced its basis in the goods.
The chief counsel concluded that defective merchandise allowances were akin to trade discounts and were properly accounted for as reductions to the inventory cost rather than as part of sales receipts, despite the fact that the allowances were provided instead of actual merchandise returns and despite the fact that the allowances were characterized as compensation for the defective goods.
Taxpayers have argued that those volume-based advertising allowances should be treated as reductions in the purchase price of the inventory per the trade discount rules discussed below.
In Westpac Pacific Food, (1) the Ninth Circuit, reversing the Tax Court, found that a repayment obligation prevented an advance trade discount from creating an accession to wealth and therefore concluded that it did not constitute gross income when received.
98, but Asiedu used a "Sally's Card" to obtain the trade discount of more than two thirds off.
Make an exception to this rule only when you are offered a trade discount for early payment.
For instance, if a Japanese customer buys a 100,000-yen product and gets a 10 percent trade discount, we convert those amounts into dollars and show that as a single transaction in all Hewlett-Packard systems.
If there is need for supplies operating fluid outside those listed in the Technical Specification contracting authority reserves the right to make an additional request within 10% of the contract value of public procurement in unit value, net of trade discount from catalog the contractor / manufacturer that placed bids contractor in the price quote.