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The total of the discounts received column in the three column cash book is?

The total of the discounts received column in the three column cash book is?
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  • A Debited to discounts received account
  • B Credited to discounts received account
  • C Debited to discounts allowed account
  • D Credited to discount allowed account
Correct Answer: Option B
Explanation:
The total of discount column on credit side represents the total cash discount received from suppliers during the period and is posted to the discount received account maintained in the ledger.
Discount allowed is an expense and discount received is an income of the business.

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