Gross accounts receivable minus allowance for bad debt is equal to net accounts receivable, or the actual value of the business's accounts receivable as determined through its estimates.

Higher accounts receivable can reduce cash flow since it involves waiting for customer payments. Review the statement of cash flows to understand overall cash impact without complex calculations.

If the amount of accounts receivable collected by the target company in a set period is higher, then the net working capital needed to cover expenses is typically lower. This can be done by ...