The term ‘discounts’ is a broad and varied meaning word when it comes to use in business. It literally has four distinct definitions. Each definition is used within a certain context of business. The first and most dollar expensive use is with original issue discount related to bonds in the market. The second use and most common is as an incentive in business.
Original Issue Discount
A term used in the bond industry; original issue discount (OID) refers to the dollar value discounted on the face value of a bond to sell the bond.