#bad-debt
Estimate, write off, and recover uncollectible accounts receivable
How buy-here-pay-here dealers should book installment notes receivable, separate unearned finance charges from vehicle-sale revenue, reserve for repossessions on portfolios where ~78% of loan volume is subprime, and structure a Related Finance Company that survives an IRS audit — plus why accrual accounting and year-of-sale gain recognition are mandatory for dealer inventory.
On July 15, 2026, a Texas bankruptcy court confirmed QVC Group's prepackaged Chapter 11 plan, cutting debt from $6.6 billion to $1.325 billion while classifying vendors as unimpaired — 'paid in full or reinstated.' Here's what that classification actually means for wholesale suppliers, how to split pre-petition and post-petition receivables, when (not) to book a bad-debt allowance, and how to model the cash-flow risk of a customer in restructuring.
An AR aging report sorts unpaid invoices into current, 1–30, 31–60, 61–90, and 90+ day buckets so you can spot cash flow risk early. Healthy businesses keep 70–80% of receivables in the first two buckets; collection odds drop below 70% past 90 days. Here's how to read the buckets, run a weekly collections workflow, and turn the report into a cash forecast.
B2B BNPL providers pay suppliers 100% of invoice value up front while buyers keep their net-30 to net-90 terms, moving default risk off the supplier's books. With bad debt averaging ~8% of credit sales and the market projected to grow from $204 billion in 2025 to $466 billion by 2030, here's how the model works, what it costs, and how to record financed invoices correctly.
Trade credit insurance reimburses 75-95% of unpaid invoices when a customer defaults for a covered reason, typically costing 0.25-0.5% of insured sales, but disputed invoices and missed claim windows (30 days for insolvency, 3-6 months for other defaults) are excluded.
Involuntary churn accounts for 20-40% of total subscription churn and drains roughly 9% of MRR industry-wide, but smart retries, dunning emails, and card account updaters can recover 60-80% of it if failed charges are booked as AR, not lost revenue.
The allowance for doubtful accounts estimates uncollectible receivables. Learn the aging and percentage-of-sales methods, plus how write-offs keep accounts
