Trade Receivables Impairment Loss Simulation - Experiment with different variables to understand how they affect financial statements
Given Trade receivables:
$10,000
Given Allowance for impairment of trade receivables:
$500
Amount confirmed uncollectible:
$100
$200
$300
$400
Percentage estimated uncollectible:
1%
2%
3%
4%
Show workings
Statement of Financial Performance
Less: Other Expenses
Reversal of impairment loss on trade receivables
(99 - 400)
(301)
Statement of Financial Position
Current Assets
Trade receivables
(10,000 - 100)
9,900
Less: Allowance for impairment of trade receivables
(1% × 9,900)
(99)
Net trade receivables
(9,900 - 99)
9,801