Sales Returns and Allowances and Sales Discounts are both designed to encourage customers to pay their accounts promptly.

Sales Returns and Allowances are offered to customers who have received damaged or defective goods, or who are not satisfied with their purchase. This encourages customer satisfaction and retention, but does not necessarily encourage prompt payment.

Sales Discounts, on the other hand, are discounts offered to customers who pay their accounts promptly, typically within a certain time frame (e.g. 2/10 net 30). This serves as an incentive for customers to pay their bills on time and improves the company's cash flow.