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Tribune Media Co (OTCPK:TRBAA)
Accounts Receivable
$592 Mil (As of Sep. 2008)

Accounts Receivable are created when a customer has received a product but has not yet paid for that product. Tribune Media Co's accounts receivables for the quarter that ended in Sep. 2008 was $592 Mil.

Accounts receivable can be measured by Days Sales Outstanding. Tribune Media Co's Days Sales Outstanding for the quarter that ended in Sep. 2008 was 51.95.

In Ben Graham’s calculation of liquidation value, accounts receivable are only considered to be worth 75% of book value. Tribune Media Co's Liquidation Value for the quarter that ended in Sep. 2008 was $-13,182 Mil.


Definition

Accounts Receivable is money owed to a business by customers and shown on its Balance Sheet as an asset.


Explanation

1. Accounts Receivable are created when a customer has received a product but has not yet paid for that product. Days sales outstanding measures of the average number of days that a company takes to collect revenue after a sale has been made. It is a financial ratio that illustrates how well a company's accounts receivables are being managed.

Tribune Media Co's Days Sales Outstanding for the quarter that ended in Sep. 2008 is calculated as:

Days Sales Outstanding
=Account Receivable/Revenue*Days in Period
=591.922/1036.946*91
=51.95

2. In Ben Graham’s calculation of liquidation value, Tribune Media Co's accounts receivable are only considered to be worth 75% of book value:

Tribune Media Co's liquidation value for the quarter that ended in Sep. 2008 is calculated as:

Liquidation value
=Cash and Cash Equivalents-Total Liabilities+(0.75 * Account Receivable)+(0.5 * Inventory)
=259.9-13901.777+0.75 * 591.922+0.5 * 31.792
=-13,182

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Be Aware

Net receivables tells us a great deal about the different competitors in the same industry. In competitive industries, some attempt to gain advantage by offering better credit terms, causing increase in sales and receivables.

If company consistently shows lower % Net receivables to gross sales than competitors, then it usually has some kind of competitive advantage which requires further digging.

Average Days Sales Outstanding is a good indicator for measuring a company’s sales channel and customers. A company may book great revenue and earnings growth but never receive payment from their customers. This may force a write-off in the future and depress future earnings.


Related Terms

Days Sales Outstanding, Revenue, NCAV, Cash and Cash Equivalents, Total Liabilities, Inventory


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Tribune Media Co Annual Data

Dec98Dec99Dec00Dec01Dec02Dec03Dec04Dec05Dec06Dec07
Accts Rec. 00000867850798253247

Tribune Media Co Quarterly Data

Jun06Sep06Dec06Mar07Jun07Sep07Dec07Mar08Jun08Sep08
Accts Rec. 8067672536776951,086247662603592
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