Which book would post entries to the payables ledger control account for discounts received?

Which book would post entries to the payables ledger control account for discounts received?

• A. Discounts received pay book
• B. Purchases day book
• C. Sales day book
• D. Cash book payments

Answer: (A)

Discounts received reduce what you owe to suppliers, so the entry that records this adjustment goes into the discounts received area and then affects the payables ledger control account. The Discounts received pay book is the subsidiary book used to capture these reductions from supplier invoices, and the totals from that book flow into the payables ledger control account in the general ledger. The other books serve different purposes: the purchases day book records credit purchases, the sales day book records credit sales, and the cash book payments records cash outflows (including any discount taken at the time of payment, but the formal posting to the liability is through the discounts received pay book).

Discounts received reduce what you owe to suppliers, so the entry that records this adjustment goes into the discounts received area and then affects the payables ledger control account. The Discounts received pay book is the subsidiary book used to capture these reductions from supplier invoices, and the totals from that book flow into the payables ledger control account in the general ledger.

The other books serve different purposes: the purchases day book records credit purchases, the sales day book records credit sales, and the cash book payments records cash outflows (including any discount taken at the time of payment, but the formal posting to the liability is through the discounts received pay book).