cash discount

A cash discount is referred to as the subsequent discount on the invoice amount for payment of the amount due within a certain period.

Cash discounts are particularly common between manufacturers and dealers. In contrast to the discount, the deduction is not made immediately after the purchase, but only when the invoice is paid. Since the allowance for the customer generates an incentive for timely payment, sellers grant cash discount, among other things, to reduce the risk of default actions.

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