What were the deductions for the allowance for doubtful accounts for Budget in 2023, expressed in millions of dollars?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
ed average interest rate of 8.01%. These notes were issued under previously outstanding series of debt.
In February 2025, we borrowed $500 million under a floating rate term loan due December 2025, which is part of our senior revolving credit facilities.
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Schedule II – Valuation and Qualifying Accounts
| (in millions) Description | Balance of | at Beginning Period | Expe | nse (Benefit) | Other Adjustments (a) | _ | Deductions | Balance at End of Period |
|---|
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 79)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, the deductions for the allowance for doubtful accounts in 2023 were $86 million. This figure represents the amount that Budget wrote off as uncollectible from its accounts receivable during that year. The allowance for doubtful accounts is a contra-asset account used to estimate the amount of accounts receivable that a company does not expect to collect.
For a prospective Budget franchisee, understanding these figures is crucial for assessing the financial health and stability of the company. Deductions for doubtful accounts can indicate the credit risk Budget takes on, and how effectively it manages collections. Higher deductions might suggest a more lenient credit policy or difficulties in collecting payments from customers.
It's important to note that this is just one metric among many to consider when evaluating a franchise opportunity. A prospective franchisee should review the complete financial statements and consult with a financial advisor to gain a comprehensive understanding of Budget's financial performance and risk profile.