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How to manage untaken fast-pay discounts
February 2, 2024
Q. An account with discounted payment terms pays within those terms but does not take the discount. Do you show the earned discount as a credit or cash on account? Advise the account to take the credit against an upcoming payment?
A.
(Answered by the IOFM Advisory Panel)
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We do not give discounts.
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Since the receivable is in customer ledger minus the discount, once the cash application has been performed, there will be an unapplied balance remaining on the receipt itself.
It’s cleaner…
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