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Discounts on products

We are trying to find the correct answer for recognize revenues/sales correctly.

We have an item priced at $25.00 and we sell it for $20.00 due to the customer is a member of our club. Where would I enter the $5.00 reduction in sale price? Because the next person who purchased the item paid the retail price of $25.00.

Do we put the $5.00 in a discount in sales/revenue or operating expense?