O-LevelAccountingAccounting procedures7707/12 · May/June 2025 · Q61 Mark

Which statement about cash discounts is not correct?

ACash discounts are given if payment is made within the time limit set by the supplier.

BCash discounts are shown as a reduction from the list price when goods are ordered.

CCustomers will show cash discounts given to them as other income in the income statement.

DSuppliers will show the cash discounts they give as an expense in the income statement.

✓ Correct answer

B: Cash discounts are shown as a reduction from the list price when goods are ordered.

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Topic: Accounting procedures, O-Level Accounting (syllabus 7707). Multiple choice, 1 mark.
Source: O-Level Accounting, May/June 2025 Paper 1 Variant 2, question 6.

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