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Microsoft Excel LibreOffice Calc

Oracle Corp. (ORCL)


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.


Receivables Accounting Policy

Allowances for Doubtful Accounts

Oracle records allowances for doubtful accounts based upon a specific review of all significant outstanding invoices. For those invoices not specifically reviewed, provisions are provided at differing rates, based upon the age of the receivable, the collection history associated with the geographic region that the receivable was recorded in and current economic trends. Oracle writes-off a receivable and charges it against its recorded allowance when Oracle has exhausted the collection efforts without success.

Source: 10-K (filing date: 2019-06-21).


Allowance for Doubtful Accounts Receivable

Microsoft Excel LibreOffice Calc
May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014
Selected Financial Data (USD $ in millions)
Allowances for doubtful trade receivables hidden hidden hidden hidden hidden hidden
Trade receivables, gross hidden hidden hidden hidden hidden hidden
Ratio
Allowance as a percentage of trade receivables, gross1 hidden hidden hidden hidden hidden hidden

Based on: 10-K (filing date: 2019-06-21), 10-K (filing date: 2018-06-22), 10-K (filing date: 2017-06-27), 10-K (filing date: 2016-06-22), 10-K (filing date: 2015-06-25), 10-K (filing date: 2014-06-26).

2019 Calculations

1 Allowance as a percentage of trade receivables, gross = 100 × Allowances for doubtful trade receivables ÷ Trade receivables, gross
= 100 × hidden ÷ hidden = hidden

Ratio Description The company
Allowance as a percentage of trade receivables, gross Allowance for doubtful accounts divided by the gross accounts receivable. Oracle Corp.’s allowance as a percentage of trade receivables, gross increased from 2017 to 2018 and from 2018 to 2019.