diff --git a/erpnext/accounts/doctype/pricing_rule/pricing_rule.json b/erpnext/accounts/doctype/pricing_rule/pricing_rule.json
index c681c89..cc8ed4b 100644
--- a/erpnext/accounts/doctype/pricing_rule/pricing_rule.json
+++ b/erpnext/accounts/doctype/pricing_rule/pricing_rule.json
@@ -504,10 +504,10 @@
   },
   {
    "default": "0",
-   "depends_on": "eval:in_list(['Discount Percentage', 'Discount Amount'], doc.rate_or_discount) && doc.apply_multiple_pricing_rules",
+   "depends_on": "eval:in_list(['Discount Percentage'], doc.rate_or_discount) && doc.apply_multiple_pricing_rules",
    "fieldname": "apply_discount_on_rate",
    "fieldtype": "Check",
-   "label": "Apply Discount on Rate"
+   "label": "Apply Discount on Discounted Rate"
   },
   {
    "default": "0",
@@ -563,7 +563,7 @@
  "icon": "fa fa-gift",
  "idx": 1,
  "links": [],
- "modified": "2020-08-26 12:24:44.740734",
+ "modified": "2020-10-28 16:53:14.416172",
  "modified_by": "Administrator",
  "module": "Accounts",
  "name": "Pricing Rule",
diff --git a/erpnext/accounts/doctype/pricing_rule/pricing_rule.py b/erpnext/accounts/doctype/pricing_rule/pricing_rule.py
index 454776e..149c476 100644
--- a/erpnext/accounts/doctype/pricing_rule/pricing_rule.py
+++ b/erpnext/accounts/doctype/pricing_rule/pricing_rule.py
@@ -60,6 +60,15 @@
 		if self.price_or_product_discount == 'Price' and not self.rate_or_discount:
 			throw(_("Rate or Discount is required for the price discount."), frappe.MandatoryError)
 
+		if self.apply_discount_on_rate:
+			if not self.priority:
+				throw(_("As the field {0} is enabled, the field {1} is mandatory.")
+					.format(frappe.bold("Apply Discount on Discounted Rate"), frappe.bold("Priority")))
+
+			if self.priority and cint(self.priority) == 1:
+				throw(_("As the field {0} is enabled, the value of the field {1} should be more than 1.")
+					.format(frappe.bold("Apply Discount on Discounted Rate"), frappe.bold("Priority")))
+
 	def validate_applicable_for_selling_or_buying(self):
 		if not self.selling and not self.buying:
 			throw(_("Atleast one of the Selling or Buying must be selected"))
@@ -226,12 +235,11 @@
 
 	item_details = frappe._dict({
 		"doctype": args.doctype,
+		"has_margin": False,
 		"name": args.name,
 		"parent": args.parent,
 		"parenttype": args.parenttype,
-		"child_docname": args.get('child_docname'),
-		"discount_percentage_on_rate": [],
-		"discount_amount_on_rate": []
+		"child_docname": args.get('child_docname')
 	})
 
 	if args.ignore_pricing_rule or not args.item_code:
@@ -279,6 +287,10 @@
 				else:
 					get_product_discount_rule(pricing_rule, item_details, args, doc)
 
+		if not item_details.get("has_margin"):
+			item_details.margin_type = None
+			item_details.margin_rate_or_amount = 0.0
+
 		item_details.has_pricing_rule = 1
 
 		item_details.pricing_rules = frappe.as_json([d.pricing_rule for d in rules])
@@ -330,13 +342,11 @@
 def apply_price_discount_rule(pricing_rule, item_details, args):
 	item_details.pricing_rule_for = pricing_rule.rate_or_discount
 
-	if ((pricing_rule.margin_type == 'Amount' and pricing_rule.currency == args.currency)
+	if ((pricing_rule.margin_type in ['Amount', 'Percentage'] and pricing_rule.currency == args.currency)
 			or (pricing_rule.margin_type == 'Percentage')):
 		item_details.margin_type = pricing_rule.margin_type
 		item_details.margin_rate_or_amount = pricing_rule.margin_rate_or_amount
-	else:
-		item_details.margin_type = None
-		item_details.margin_rate_or_amount = 0.0
+		item_details.has_margin = True
 
 	if pricing_rule.rate_or_discount == 'Rate':
 		pricing_rule_rate = 0.0
@@ -351,9 +361,9 @@
 		if pricing_rule.rate_or_discount != apply_on: continue
 
 		field = frappe.scrub(apply_on)
-		if pricing_rule.apply_discount_on_rate:
-			discount_field = "{0}_on_rate".format(field)
-			item_details[discount_field].append(pricing_rule.get(field, 0))
+		if pricing_rule.apply_discount_on_rate and item_details.get("discount_percentage"):
+			# Apply discount on discounted rate
+			item_details[field] += ((100 - item_details[field]) * (pricing_rule.get(field, 0) / 100))
 		else:
 			if field not in item_details:
 				item_details.setdefault(field, 0)
@@ -361,14 +371,6 @@
 			item_details[field] += (pricing_rule.get(field, 0)
 				if pricing_rule else args.get(field, 0))
 
-def set_discount_amount(rate, item_details):
-	for field in ['discount_percentage_on_rate', 'discount_amount_on_rate']:
-		for d in item_details.get(field):
-			dis_amount = (rate * d / 100
-				if field == 'discount_percentage_on_rate' else d)
-			rate -= dis_amount
-			item_details.rate = rate
-
 def remove_pricing_rule_for_item(pricing_rules, item_details, item_code=None):
 	from erpnext.accounts.doctype.pricing_rule.utils import (get_applied_pricing_rules,
 		get_pricing_rule_items)
diff --git a/erpnext/accounts/doctype/pricing_rule/test_pricing_rule.py b/erpnext/accounts/doctype/pricing_rule/test_pricing_rule.py
index 3555ca8..22a031c 100644
--- a/erpnext/accounts/doctype/pricing_rule/test_pricing_rule.py
+++ b/erpnext/accounts/doctype/pricing_rule/test_pricing_rule.py
@@ -385,7 +385,7 @@
 		so.load_from_db()
 		self.assertEqual(so.items[1].is_free_item, 1)
 		self.assertEqual(so.items[1].item_code, "_Test Item 2")
-	
+
 	def test_cumulative_pricing_rule(self):
 		frappe.delete_doc_if_exists('Pricing Rule', '_Test Cumulative Pricing Rule')
 		test_record = {
@@ -429,34 +429,61 @@
 		details = get_item_details(args)
 
 		self.assertTrue(details)
-	
+
 	def test_pricing_rule_for_condition(self):
 		frappe.delete_doc_if_exists("Pricing Rule", "_Test Pricing Rule")
-		
+
 		make_pricing_rule(selling=1, margin_type="Percentage", \
 			condition="customer=='_Test Customer 1' and is_return==0", discount_percentage=10)
-		
+
 		# Incorrect Customer and Correct is_return value
 		si = create_sales_invoice(do_not_submit=True, customer="_Test Customer 2", is_return=0)
 		si.items[0].price_list_rate = 1000
 		si.submit()
 		item = si.items[0]
 		self.assertEquals(item.rate, 100)
-		
+
 		# Correct Customer and Incorrect is_return value
 		si = create_sales_invoice(do_not_submit=True, customer="_Test Customer 1", is_return=1, qty=-1)
 		si.items[0].price_list_rate = 1000
 		si.submit()
 		item = si.items[0]
 		self.assertEquals(item.rate, 100)
-		
+
 		# Correct Customer and correct is_return value
 		si = create_sales_invoice(do_not_submit=True, customer="_Test Customer 1", is_return=0)
 		si.items[0].price_list_rate = 1000
 		si.submit()
 		item = si.items[0]
 		self.assertEquals(item.rate, 900)
-		
+
+	def test_multiple_pricing_rules(self):
+		make_pricing_rule(discount_percentage=20, selling=1, priority=1, apply_multiple_pricing_rules=1,
+			title="_Test Pricing Rule 1")
+		make_pricing_rule(discount_percentage=10, selling=1, title="_Test Pricing Rule 2", priority=2,
+			apply_multiple_pricing_rules=1)
+		si = create_sales_invoice(do_not_submit=True, customer="_Test Customer 1", qty=1)
+		self.assertEqual(si.items[0].discount_percentage, 30)
+		si.delete()
+
+		frappe.delete_doc_if_exists("Pricing Rule", "_Test Pricing Rule 1")
+		frappe.delete_doc_if_exists("Pricing Rule", "_Test Pricing Rule 2")
+
+	def test_multiple_pricing_rules_with_apply_discount_on_discounted_rate(self):
+		frappe.delete_doc_if_exists("Pricing Rule", "_Test Pricing Rule")
+
+		make_pricing_rule(discount_percentage=20, selling=1, priority=1, apply_multiple_pricing_rules=1,
+			title="_Test Pricing Rule 1")
+		make_pricing_rule(discount_percentage=10, selling=1, priority=2,
+			apply_discount_on_rate=1, title="_Test Pricing Rule 2", apply_multiple_pricing_rules=1)
+
+		si = create_sales_invoice(do_not_submit=True, customer="_Test Customer 1", qty=1)
+		self.assertEqual(si.items[0].discount_percentage, 28)
+		si.delete()
+
+		frappe.delete_doc_if_exists("Pricing Rule", "_Test Pricing Rule 1")
+		frappe.delete_doc_if_exists("Pricing Rule", "_Test Pricing Rule 2")
+
 def make_pricing_rule(**args):
 	args = frappe._dict(args)
 
@@ -468,6 +495,7 @@
 		"applicable_for": args.applicable_for,
 		"selling": args.selling or 0,
 		"currency": "USD",
+		"apply_discount_on_rate": args.apply_discount_on_rate or 0,
 		"buying": args.buying or 0,
 		"min_qty": args.min_qty or 0.0,
 		"max_qty": args.max_qty or 0.0,
@@ -476,9 +504,13 @@
 		"rate": args.rate or 0.0,
 		"margin_type": args.margin_type,
 		"margin_rate_or_amount": args.margin_rate_or_amount or 0.0,
-		"condition": args.condition or ''
+		"condition": args.condition or '',
+		"apply_multiple_pricing_rules": args.apply_multiple_pricing_rules or 0
 	})
 
+	if args.get("priority"):
+		doc.priority = args.get("priority")
+
 	apply_on = doc.apply_on.replace(' ', '_').lower()
 	child_table = {'Item Code': 'items', 'Item Group': 'item_groups', 'Brand': 'brands'}
 	doc.append(child_table.get(doc.apply_on), {
diff --git a/erpnext/accounts/doctype/pricing_rule/utils.py b/erpnext/accounts/doctype/pricing_rule/utils.py
index 25840d4..b003328 100644
--- a/erpnext/accounts/doctype/pricing_rule/utils.py
+++ b/erpnext/accounts/doctype/pricing_rule/utils.py
@@ -14,9 +14,8 @@
 from erpnext.setup.doctype.item_group.item_group import get_child_item_groups
 from erpnext.stock.doctype.warehouse.warehouse import get_child_warehouses
 from erpnext.stock.get_item_details import get_conversion_factor
-from frappe import _, throw
-from frappe.utils import cint, flt, get_datetime, get_link_to_form, getdate, today
-
+from frappe import _, bold
+from frappe.utils import cint, flt, get_link_to_form, getdate, today, fmt_money
 
 class MultiplePricingRuleConflict(frappe.ValidationError): pass
 
@@ -42,6 +41,7 @@
 	if not pricing_rules: return []
 
 	if apply_multiple_pricing_rules(pricing_rules):
+		pricing_rules = sorted_by_priority(pricing_rules)
 		for pricing_rule in pricing_rules:
 			pricing_rule = filter_pricing_rules(args, pricing_rule, doc)
 			if pricing_rule:
@@ -53,6 +53,20 @@
 
 	return rules
 
+def sorted_by_priority(pricing_rules):
+	# If more than one pricing rules, then sort by priority
+	pricing_rules_list = []
+	pricing_rule_dict = {}
+	for pricing_rule in pricing_rules:
+		if not pricing_rule.get("priority"): continue
+
+		pricing_rule_dict.setdefault(cint(pricing_rule.get("priority")), []).append(pricing_rule)
+
+	for key in sorted(pricing_rule_dict):
+		pricing_rules_list.append(pricing_rule_dict.get(key))
+
+	return pricing_rules_list or pricing_rules
+
 def filter_pricing_rule_based_on_condition(pricing_rules, doc=None):
 	filtered_pricing_rules = []
 	if doc:
@@ -284,12 +298,13 @@
 			fieldname = field
 
 	if fieldname:
-		msg = _("""If you {0} {1} quantities of the item <b>{2}</b>, the scheme <b>{3}</b>
-			will be applied on the item.""").format(type_of_transaction, args.get(fieldname), item_code, args.rule_description)
+		msg = (_("If you {0} {1} quantities of the item {2}, the scheme {3} will be applied on the item.")
+			.format(type_of_transaction, args.get(fieldname), bold(item_code), bold(args.rule_description)))
 
 		if fieldname in ['min_amt', 'max_amt']:
-			msg = _("""If you {0} {1} worth item <b>{2}</b>, the scheme <b>{3}</b> will be applied on the item.
-				""").format(frappe.fmt_money(type_of_transaction, args.get(fieldname)), item_code, args.rule_description)
+			msg = (_("If you {0} {1} worth item {2}, the scheme {3} will be applied on the item.")
+				.format(type_of_transaction, fmt_money(args.get(fieldname), currency=args.get("currency")),
+					bold(item_code), bold(args.rule_description)))
 
 		frappe.msgprint(msg)
 
diff --git a/erpnext/controllers/accounts_controller.py b/erpnext/controllers/accounts_controller.py
index 983cfa8..6108a61 100644
--- a/erpnext/controllers/accounts_controller.py
+++ b/erpnext/controllers/accounts_controller.py
@@ -263,6 +263,7 @@
 			if self.doctype == "Quotation" and self.quotation_to == "Customer" and parent_dict.get("party_name"):
 				parent_dict.update({"customer": parent_dict.get("party_name")})
 
+			self.pricing_rules = []
 			for item in self.get("items"):
 				if item.get("item_code"):
 					args = parent_dict.copy()
@@ -301,6 +302,7 @@
 
 					if ret.get("pricing_rules"):
 						self.apply_pricing_rule_on_items(item, ret)
+						self.set_pricing_rule_details(item, ret)
 
 			if self.doctype == "Purchase Invoice":
 				self.set_expense_account(for_validate)
@@ -322,6 +324,9 @@
 					if item.get('discount_amount'):
 						item.rate = item.price_list_rate - item.discount_amount
 
+				if item.get("apply_discount_on_discounted_rate") and pricing_rule_args.get("rate"):
+					item.rate = pricing_rule_args.get("rate")
+
 			elif pricing_rule_args.get('free_item_data'):
 				apply_pricing_rule_for_free_items(self, pricing_rule_args.get('free_item_data'))
 
@@ -335,6 +340,18 @@
 						frappe.msgprint(_("Row {0}: user has not applied the rule {1} on the item {2}")
 							.format(item.idx, frappe.bold(title), frappe.bold(item.item_code)))
 
+	def set_pricing_rule_details(self, item_row, args):
+		pricing_rules = get_applied_pricing_rules(args.get("pricing_rules"))
+		if not pricing_rules: return
+
+		for pricing_rule in pricing_rules:
+			self.append("pricing_rules", {
+				"pricing_rule": pricing_rule,
+				"item_code": item_row.item_code,
+				"child_docname": item_row.name,
+				"rule_applied": True
+			})
+
 	def set_taxes(self):
 		if not self.meta.get_field("taxes"):
 			return
diff --git a/erpnext/controllers/taxes_and_totals.py b/erpnext/controllers/taxes_and_totals.py
index 92cfdb7..81d07c1 100644
--- a/erpnext/controllers/taxes_and_totals.py
+++ b/erpnext/controllers/taxes_and_totals.py
@@ -608,16 +608,19 @@
 		base_rate_with_margin = 0.0
 		if item.price_list_rate:
 			if item.pricing_rules and not self.doc.ignore_pricing_rule:
+				has_margin = False
 				for d in get_applied_pricing_rules(item.pricing_rules):
 					pricing_rule = frappe.get_cached_doc('Pricing Rule', d)
 
-					if (pricing_rule.margin_type == 'Amount' and pricing_rule.currency == self.doc.currency)\
+					if (pricing_rule.margin_type in ['Amount', 'Percentage'] and pricing_rule.currency == self.doc.currency)\
 							or (pricing_rule.margin_type == 'Percentage'):
 						item.margin_type = pricing_rule.margin_type
 						item.margin_rate_or_amount = pricing_rule.margin_rate_or_amount
-					else:
-						item.margin_type = None
-						item.margin_rate_or_amount = 0.0
+						has_margin = True
+
+				if not has_margin:
+					item.margin_type = None
+					item.margin_rate_or_amount = 0.0
 
 			if item.margin_type and item.margin_rate_or_amount:
 				margin_value = item.margin_rate_or_amount if item.margin_type == 'Amount' else flt(item.price_list_rate) * flt(item.margin_rate_or_amount) / 100