Stock Analysis on Net
Stock Analysis on Net

Cadence Design Systems Inc. (NASDAQ:CDNS)

Analysis of Bad Debts

Microsoft Excel

Allowance for doubtful accounts receivable (bad debts) is a contra account which reduce the balance of the company 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
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 28, 2019
Selected Financial Data (US$ in thousands)
Allowance for doubtful accounts 4,553 2,290 3,692 2,867 869
Receivables, gross 504,532 491,735 346,386 345,009 308,497
Financial Ratio
Allowance as a percentage of receivables, gross1 0.90% 0.47% 1.07% 0.83% 0.28%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-28).

1 2023 Calculation
Allowance as a percentage of receivables, gross = 100 × Allowance for doubtful accounts ÷ Receivables, gross
= 100 × 4,553 ÷ 504,532 = 0.90%

Financial ratio Description The company
Allowance as a percentage of receivables, gross Allowance for doubtful accounts divided by the gross accounts receivable. Cadence Design Systems Inc. allowance as a percentage of receivables, gross decreased from 2021 to 2022 but then increased from 2022 to 2023 not reaching 2021 level.