Salon City (Salon City) Accounts Receivable : $0.19 Mil (As of Sep. 2008)

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What is Salon City Accounts Receivable?

Accounts Receivable are created when a customer has received a product but has not yet paid for that product. Salon City's accounts receivables for the quarter that ended in Sep. 2008 was $0.19 Mil.

Accounts receivable can be measured by Days Sales Outstanding. Salon City's Days Sales Outstanding for the quarter that ended in Sep. 2008 was 3,431.00.

In Ben Graham's calculation of Net-Net Working Capital, accounts receivable are only considered to be worth 75% of book value. Salon City's Net-Net Working Capital per share for the quarter that ended in Sep. 2008 was $-0.08.

Salon City Accounts Receivable Historical Data

The historical data trend for Salon City's Accounts Receivable can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Salon City Accounts Receivable Chart

Salon City Annual Data

Trend

Dec06

Dec07

Accounts Receivable

0.07

0.01

Salon City Quarterly Data
	Mar07	Jun07	Sep07	Dec07	Mar08	Jun08	Sep08
Accounts Receivable	Get a 7-Day Free Trial			0.13	0.01	0.03	0.12	0.19

Salon City Accounts Receivable Calculation

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

Salon City Accounts Receivable 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.

Salon City's Days Sales Outstanding for the quarter that ended in Sep. 2008 is calculated as:

	Days Sales Outstanding
=	Accounts Receivable	/	Revenue	*	Days in Period
=	0.188	/	0.005	*	91
=	3,431.00

2. In Ben Graham's calculation of Net-Net Working Capital (NNWC), Salon City's accounts receivable are only considered to be worth 75% of book value:

Salon City's Net-Net Working Capital Per Share for the quarter that ended in Sep. 2008 is calculated as:

	Net-Net Working Capital Per Share
=	(Cash And Cash Equivalents	+	0.75 * Accounts Receivable	+	0.5 * Total Inventories	-	Total Liabilities
-	Preferred Stock	-	Minority Interest)	/	Shares Outstanding (EOP)
=	(0.024	+	0.75 * 0.188	+	0.5 * 0	-	0.953
-	0	-	0)	/	9.93716
=	-0.08

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.

Salon City Accounts Receivable Related Terms

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Salon City (Salon City) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Communication Services » Media - Diversified » Salon City Inc (OTCPK:SALN) » Definitions » Accounts Receivable

Comparable Companies

Traded in Other Exchanges

N/A

Address

909 North Palm Avenue, Suite 311, West Hollywood, CA, USA, 90069

Website

http://www.saloncity.com

Salon City Inc is engaged in the beauty industry through its media and network. Geographically the business presence of the group are seen in United States and internationally.

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