reserve for bad debt

reserve for bad debt

An expense item on a profit and loss statement for the current period's pro rata share of anticipated annual credit losses due to unpaid bills or defaulting tenants.

References in periodicals archive ?
Credit managers don't like to offer them, customers don't like to sign them and many a CFO view them with such skepticism they force the controller to accrue note balances in the reserve for bad debt. That being said, in these tough times the promissory note can be an excellent instrument for reducing and/or eliminating loss and preserving a good account.
Delta must also establish and maintain a reserve for bad debts. Procedures for writing-off of bad debts and the approval and policies for writing-off bad debts must also be established.
Excluding Stadtlander, which was hit by an increase in the reserve for bad debts, the group would have posted a 73% jump in sales and a 110% gain in operating profits for the quarter.
These charges include a fee of $31.3 million after taxes for an increase in the reserve for bad debts in Latin America; a provision for inventory obsolescence in the United States; and unallocated expenses that include the cost of downsizing corporate offices.
585 now applies to eligible thrift institutions that previously kept a reserve for bad debts under Sec.
[sections] 1.446-1(e)(2)(ii)(b) gives two examples -- an adjustment to a reserve for bad debts under the section 166 regulations (which is no longer available to most taxpayers), and an adjustment to the useful life of a depreciable asset under the section 167(b) regulations (which is no longer available for most assets, which are depreciated under section 168 or section 197).
SCHUETZE: But we have a ton, a long ton, of anecdotal evidence that the reserve for bad debts in many financial institutions did not measure up.
1.585-2(a)(2) and gives banks the ammunition to determine a reasonable addition to the reserve for bad debts.
Similar rules are provided for a member's deduction for the worthlessness of (and for an addition to a reserve for bad debts with respect to) an obligation.
(10) prior to 1986, taxpayers were permitted to deduct a reserve for bad debts. Sec.