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WAEC Financial Accounting 1991 (August) Question 13

Question 13

Final Accounts of a Sole Trader

Discount allowed is a charge to

  1. A.Trading Account
  2. B.Balance Sheet
  3. C.Profit and Loss Account
  4. D.Profit and Loss Appropriation Account
  5. E.Current Account.
Show the answer and explanation

Answer: C (Profit and Loss Account)

Explanation

Discount allowed is an expense, so it is charged in the profit and loss account.