Stock Analysis on Net
Stock Analysis on Net
Microsoft Excel LibreOffice Calc

Air Products & Chemicals Inc. (NYSE:APD)

Analysis of Bad Debts

Advanced level

Allowance for doubtful accounts receivable (bad debts) is a contra account which reduce the balance of the company’s gross accounts receivable. The relationship between the allowance and the balance in receivables should be relatively constant unless there is a change in the economy overall or a change in customer base.

Allowance for Doubtful Accounts Receivable

Microsoft Excel LibreOffice Calc
Sep 30, 2020 Sep 30, 2019 Sep 30, 2018 Sep 30, 2017 Sep 30, 2016 Sep 30, 2015
Selected Financial Data (US$ in thousands)
Allowance for doubtful accounts 23,900  48,800  24,000  45,800  22,800  26,300 
Trade receivables, gross 1,298,700  1,309,000  1,231,200  1,219,800  1,462,700  1,432,500 
Financial Ratio
Allowance as a percentage of trade receivables, gross1 1.84% 3.73% 1.95% 3.75% 1.56% 1.84%

Based on: 10-K (filing date: 2020-11-19), 10-K (filing date: 2019-11-26), 10-K (filing date: 2018-11-20), 10-K (filing date: 2017-11-16), 10-K (filing date: 2016-11-21), 10-K (filing date: 2015-11-24).

1 2020 Calculation
Allowance as a percentage of trade receivables, gross = 100 × Allowance for doubtful accounts ÷ Trade receivables, gross
= 100 × 23,900 ÷ 1,298,700 = 1.84%

Financial ratio Description The company
Allowance as a percentage of trade receivables, gross Allowance for doubtful accounts divided by the gross accounts receivable. Air Products & Chemicals Inc.’s allowance as a percentage of trade receivables, gross increased from 2018 to 2019 but then decreased significantly from 2019 to 2020.