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Microsoft Excel LibreOffice Calc

Caterpillar Inc. (CAT)


Analysis of Bad Debts

Difficulty: Advanced

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 Credit Losses

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data (USD $ in millions)
Allowance for credit losses hidden hidden hidden hidden hidden
Finance receivables, gross hidden hidden hidden hidden hidden
Ratio
Allowance as a percentage of finance receivables, gross1 hidden hidden hidden hidden hidden

Based on: 10-K (filing date: 2019-02-14), 10-K (filing date: 2018-02-15), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-16), 10-K (filing date: 2015-02-17).

2018 Calculations

1 Allowance as a percentage of finance receivables, gross = 100 × Allowance for credit losses ÷ Finance receivables, gross
= 100 × hidden ÷ hidden = hidden

Ratio Description The company
Allowance as a percentage of finance receivables, gross Allowance for credit losses divided by the gross financing receivable. Caterpillar Inc.’s allowance as a percentage of finance receivables, gross increased from 2016 to 2017 and from 2017 to 2018.