Accounting Question: ANY public companies with NO Bad Debts Expense?

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CaptainKahuna

Platinum Member
May 19, 2002
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www.billda.com
My intro accounting professor offered anyone in our class that could show him a public company with zero bad debts expense 5 bonus points on their FINAL GRADE.

I'm 2 points from an A in the class, so I'm trying to find one.

Does anyone know of a company without any bad debts expense? Or where I may start looking for one?

The first one to give me a name and a link to their financials will get $20 PayPal as soon as I get it approved by my professor.

Good luck

EDIT: For the love of god, if you don't know what bad debts expense is, don't reply. Bad debts expense IS NOT THE SAME as debt. Just because a company has no debt does not mean they have no bad debts expense.
 
M

Mday

Lifer
Oct 14, 1999
18,647
1
81
Originally posted by: CaptainKahuna
My intro accounting professor offered anyone in our class that could show him a public company with zero bad debts expense 5 bonus points on their FINAL GRADE.

I'm 2 points from an A in the class, so I'm trying to find one.

Does anyone know of a company without any bad debts expense? Or where I may start looking for one?

The first one to give me a name and a link to their financials will get $20 PayPal as soon as I get it approved by my professor.

Good luck
Click to expand...

look up any SEC filings google has...

debt is a good thing for most companies btw.
 
M

MaxDSP

Lifer
May 15, 2001
10,056
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shoot, MSFT has no debt, but I dont think thats the number youre looking for
 
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Argo

Lifer
Apr 8, 2000
10,045
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Originally posted by: MaxDSP
shoot, MSFT has no debt, but I dont think thats the number youre looking for
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MSFT is the first thing that came to mind.
 
mephiston5

mephiston5

Senior member
May 28, 2005
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bad debt expense is when a company sells something on credit, and the buyer never pays
 
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tynopik

Diamond Member
Aug 10, 2004
5,245
500
126
somebody that sells exclusively to the government?

it sounds like someone with a very small, very select clientele (governments, large multinationals, etc)

alternatively a company that never sells on credit

 
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tynopik

Diamond Member
Aug 10, 2004
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126
maybe look at novel payment methods, for instance ez-pass where they don't actually sell anything per-se

i don't think toll jumpers would count as bad debts exactly

or maybe one of those patent licensing firms that just buy up all those patents and sue everyone in sight
 
vi edit

vi edit

Elite Member
Super Moderator
Oct 28, 1999
62,484
8,345
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Damn...that'd be tough.

Hmmm....so that would have to be a company with no true AR. Maybe look at something like McDonalds or or other restaurant's that only operate in cash-up-front types of operations.

But even then, they could incur some bad debts from franchise owners that take delivery of inventory but have not paid the corporate account back for the goods.

 
mugs

mugs

Lifer
Apr 29, 2003
48,920
46
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Originally posted by: sygyzy
What is "bad debt"?
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Debt that's been written off because the company determined they have no chance of collecting it.
 
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Zugzwang152

Lifer
Oct 30, 2001
12,134
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Originally posted by: mugs
Originally posted by: sygyzy
What is "bad debt"?
Click to expand...

Debt that's been written off because the company determined they have no chance of collecting it.
Click to expand...

I believe it is also when a company determines the cost of collecting the debt is greater than the amount they would have recovered.
 
mugs

mugs

Lifer
Apr 29, 2003
48,920
46
91
Originally posted by: Zugzwang152

I believe it is also when a company determines the cost of collecting the debt is greater than the amount they would have recovered.
Click to expand...

Yeah, I suppose that makes sense.
 
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UTmtnbiker

Diamond Member
Nov 17, 2000
4,129
4
81
About the only way you're going to find a company with ZERO bad debt expense is one that doesn't extend credit to its customers. By its nature, companies with an AR will have some payees default on payment. Name one public company that is a cash and carry only business. That's your answer....which to my knowledge is none. Every company with an AR estimates at the beginning of the year how much of its AR is uncollectable and expenses that.
 
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AccruedExpenditure

Diamond Member
May 12, 2001
6,960
7
81
Originally posted by: UTmtnbiker
About the only way you're going to find a company with ZERO bad debt expense is one that doesn't extend credit to its customers. By its nature, companies with an AR will have some payees default on payment. Name one public company that is a cash and carry only business. That's your answer....which to my knowledge is none. Every company with an AR estimates at the beginning of the year how much of its AR is uncollectable and expenses that.
Click to expand...


Ding Ding. Good luck finding a cash only public corp.
 
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