TR AND ALLOWANCE PART 3 (3E)

NOT an asset.

• PREPAID rental expense

• trade RECEIVABLE

• trade PAYABLE

• commission income RECEIVABLE

NOT a LIABILITY

• rental income RECEIVED IN ADVANCE

• PREPAID insurance expense

• trade PAYABLE

• loan

rental income RECEIVED IN ADVANCE =

• current

  ASSET

• current

  LIABILITY

When OWNER TAKE OUT GOODS FOR OWN USE

• Drawings INCREASE

• Drawings DECREASE

Allowance for impairment of TR =

• asset

• expense

• CONTRA asset

To INCREASE allowance for impairment of trade receivables

• DR allowance for impairment of tr

• CR allowance for impairment of tr

when debt is WRITTEN OFF

• DR allowance for impairment of tr

  CR tr:name

• DR tr:name

  CR allowance for impairment of tr

IMPAIRMENT LOSS on trade receivable =

• INCOME

• EXPENSE

In financial POSITION, trade receivables is presented as:

• TR

  ADD: allowance for impairment of tr

• TR

  LESS: allowance for impairment of tr

CHANGE in the allowance for impairment of tr =

• impairment loss on tr

• allowance for impairment of tr