Hello… I’m still wondering whether it’s ethical or necessary for me to include discounts allowed in my charts of accounts for the P&L yet am not actually registering any discounts received… Will my accounting records be inaccurate? Can’t I do without discounts allowed since am not accounting for discounts received?
Many of us have accounts in the chart of accounts that have 0 value, that is not a problem. If you want to see only the accounts with values above 0 in your summary just click on Edit (next to the title Summary) and enable as per screenshot “Exclude zero balances”
Thanks but that wasn’t what I wanted to know…
What I wanted to know is the whether I should include discounts allowed in my p&l statement or not because in turn I’m not recording any discounts received
Where in the P&L statement is there an option for “…discounts allowed…?” See screenshot:
If you check “Exclude zero balances” and assuming discount total is zero then it will not show in the P&L statement.
As long as you are recording the net sales or purchase amounts ie the amounts after discounts, then recording the discounts is not necessary
Discounts are nothing more than a method for adjusting the effective unit price for a given transaction. You can use the discount features of the program to do that. Or you can adjust pricing externally and enter the discounted (adjusted) price. It is purely a matter of choice whether you show the adjustment process by using the discount features. And, if you do, it is also a matter of choice whether you accumulate discounts offered or received in separate P&L accounts. (It is much more cumbersome to do that than to merely apply a discount and let the adjusted prices flow through other processes.)