Friday, September 9, 2011

Allowance for Bad Debt as a Percentage of Sales

The graph below was created using Google’s chart tool.

The vertical bar graph shows the allowance for bad debt account balance (used by companies at the end of the year) as a percentage of sales for 11 business sectors.

The data used to create the graph was taken from Internal Revenue Service statistics on form 1120s filed corporate returns for 2008. This data can be viewed on the IRS report “2008 Statistics of Income – Corporation Income Tax Returns” by clicking here (PDF file). Business receipts were used for sales. Data was used only for corporations reporting a positive net income.

The percentages are for all size companies and all subsectors, so represent an approximate benchmark average that companies can use to evaluate their own allowance for bad debt account balance to sales ratio compared to somewhat similar companies. Subsectors exist for some of the sectors, so a more similar company comparison might be available. The overall average percentage for all sectors is 0.5%.













Allowance for Bad Debt as a Percentage of Sales - 11 Business Sectors

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