Irrecoverable and Provision for Irrecoverable Debts

** Irrecoverable debts **
a) Explain why it is necessary to provide a provision for irrecoverable debts.
b) Distinguish between an irrecoverable debt and a provision for an irrecoverable debt.
c) Calculate and record irrecoverable debts and provision for irrecoverable debts in the books of account.

Increase in Provision for Doubtful Debts :
Lesson Objectives:

1. To calculate provision for irrecoverable debts for the end of the financial year.
2. To adjust for irrecoverable debts and find the net trade receivables.
3. To calculate an increase in provision for doubtful debts, post entries to the ledgers and show the impact in the financial statements.

**Decrease in Provision for Doubtful Debts : **
Lesson Objectives:

1. To calculate provision for irrecoverable debts for the end of the financial year.
2. To adjust for irrecoverable debts and find the net trade receivables.
3. To calculate an decrease in provision for doubtful debts, post entries to the ledgers and show the impact in the financial statements.

Note: Student copy and teacher copy URL is available for reference.