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WAEC Financial Accounting 1994 Question 10

Question 10

Cash Book

Cash discount is given for

  1. A.buying in large quantity
  2. B.prompt settlement of account
  3. C.being a regular customer
  4. D.introducing other customers
  5. E.sales returns.
Show the answer and explanation

Answer: B (prompt settlement of account)

Explanation

Cash discount rewards paying quickly; trade discount is for buying in bulk.