Department-Store Vendor Chargebacks and Markdown Allowances: How to Book Them and When They're Deductible (Macy's as the Example)
Vendors to department stores like Macy's see invoices cut by compliance chargebacks (Macy's calls them expense offsets), markdown allowances, co-op and freight. On the books these generally reduce revenue rather than count as expenses. For tax, an allowance reaches economic performance only when the retailer actually nets it, though the recurring item exception can pull a year-end allowance back a year.
Read article