ES3 - Accounting for Accounts Receivable

Outline of Intended Student Learning
Area of study:
Assessment technique:
Semester Two
10 hours
ES3 – Accounts Receivable
Knowledge and Procedural Practices
Supervised written and Practical assessment (supervised)
ES2 – Accounting for Cash
Specific Objectives/Subject Matter
Learning Experiences
Knowledge and Procedural Practices
Students should be able to:
 Identify, describe and explain:
- Why organisations charge their accounts receivable interest
- The necessity for a credit policy
- The contents of an effective credit policy
- The schedule of accounts receivable
- The purpose for aging accounts receivable
- How bad debts arise
- The purpose of providing for doubtful debts
- The process of calculating provision for doubtful debts
 Construct a mind map of accounting for
Accounts Receivable
 Discussion on their management of
borrowing money
 Discussion why organisation provide
credit facilities to their clients
 Discussion on the ways that
organisation’s can protect themselves
from their accounts receivable’s going
 Discussion on what constitutes an
effective credit policy.
 Analysis of a credit policy
 Discussion on the purpose of aging of
Accounts Receivable
 Discussion on bad debts and how to
avoid your clients from going bad
 Discussion on the global financial crisis
of 2008 (and continuing) and the rise in
the expense Bad Debts and the impact it
has on businesses
 Discussion on the matching principle
and how the provision for doubtful debts
fits into this principle.
 Guided practice and individual practice
activities from textbook and additional
exercises (using Excel where
appropriate) to:
- Preparation of general journal entries to
record interest revenue, bad debts,
recovery of bad debts and provision for
doubtful debts
- Posting of specialised journals to the
general ledger and subsidiary ledger
- Preparation of the Schedule of Accounts
 Opportunity to access additional
exercises as extension and revision
Apply fundamental accounting concepts to:
prepare the general journal for interest charged to accounts
prepare the general journal entries for writing off a bad debt
prepare the general journal entries for bad debts recovered
prepare the general journal entries for providing for doubtful debts
post specialised journals to the general ledger and subsidiary
Select and organise data to prepare:
- A schedule of accounts receivable