Cash Discount

It is the deduction which is given by the creditor to the debtor, if the amount is paid before the due date. e.g a buyer bought some commodity of US$ 100 from the seller and seller offer him 2% discount if the buyer pay him within 10 days from the buying date and buyer pay his dues to the seller within 10 days the seller settle his account with US$ 98 and US$ 2 will be the amount of Cash Discount