The discount column of a three column cashbook is not balanced off but periodically transferred to the discount account because discounts

Answer Details

Discounts in a three column cashbook are not balanced off but periodically transferred to the discount account because discounts do not form part of double entry. This means that discounts are not accounted for in the cashbook as cash items only, but rather as a reduction in the amount owed to the creditor. To ensure that the discounts are properly recorded in the ledger, they need to be periodically transferred to the discount account. This allows for accurate tracking and reporting of the discounts, which is important for financial management and analysis purposes.