Banking
Invoice Discounting / Supply Chain Finance
Purchasing a corporate supplier's invoices at a discount to provide early payment.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Discounted Receivables (SCF) | Asset (+) | 98,000.00 | - |
| Cash (Paid to Supplier) | Asset (-) | - | 98,000.00 |
| Deferred Discount Income (SCF) | Liability (+) | - | 2,000.00 |
💡 Accountant's Note
The bank pays the supplier 98% of the invoice. When the buyer pays at maturity, the bank collects 100%. The 2% discount income is amortized over the invoice tenor using the EIR method.
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