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

Oracle Corp. (NYSE:ORCL)

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
May 31, 2020 May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015
Selected Financial Data (US$ in millions)
Allowances for doubtful trade receivables 409  371  370  319  327  285 
Trade receivables, gross 5,960  5,505  5,649  5,619  5,712  5,903 
Financial Ratio
Allowance as a percentage of trade receivables, gross1 6.86% 6.74% 6.55% 5.68% 5.72% 4.83%

Based on: 10-K (filing date: 2020-06-22), 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).

1 2020 Calculation
Allowance as a percentage of trade receivables, gross = 100 × Allowances for doubtful trade receivables ÷ Trade receivables, gross
= 100 × 409 ÷ 5,960 = 6.86%

Financial 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 2018 to 2019 and from 2019 to 2020.