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Sir can you upload a lecture video for the above topic. There’s just notes for it.
I’m finding it pretty confusing and difficult.A lecture will be done when we have time.
In the meantime:
Receivables are:
1. a bit doubtful – Stage I – set up an estimated allowance (used to be called provision) based on 12 month expected loss – given in exam question.
2. very doubtful – Stage 2 – increase the total allowance to total expected credit losses
3. bad debts – Stage 3 – increase the allowance again to the full amount of the bad debt and net off the balance on the allowance and the balance on the receivable in the SFP.I wouldn’t lose sleep about the discounting
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