Acca financial Accounting (FA) Study Text ac ca (FA)

Purchaser perspective 

In examination questions,

 when dealing with transactions from the 

perspective of the purchaser, the purchaser will initially record the full cost of 

the goods and will then decide whether or not to take advantage of settlement 

discount terms offered by the seller. If advantage of the settlement discount is 

not taken, the gross amount is payable to the seller. If advantage is taken of the 

settlement discount terms offered, discount received should still be recorded as 

normal as a memorandum item in the cash payments book. 

The following illustration considers the same information as used in Illustration 1 

from the perspective of the purchaser.