The notes to the financial statements contain additional information about the company. To follow is an excerpt from Best Buys 2016 Form 10-K related to its receivables.

1. Summary of Significant Accounting Policies (page 61 of Best Buys 2016 Form 10-K):

Receivables

Receivables consist principally of amounts due from mobile phone network operators for commissions earned; banks for customer credit card and debit card transactions; and vendors for various vendor funding programs.

We establish allowances for uncollectible receivables based on historical collection trends and write-off history. Our allowances for uncollectible receivables were $49 million and $59 million at January 30, 2016, and January 31, 2015, respectively.

Discussion Question:

You may have noticed that Best Buy reports its accounts receivable net of the allowance within its Balance Sheet. Review the allowance for doubtful accounts balance for Best Buy in the footnote directly above. Did the balance of Best Buys allowance for doubtful accounts align with your expectations for a large retailer like Best Buy? If not, is Best Buys allowance account higher or lower than you expected? Briefly discuss your thoughts.

Best Buy Co., Inc. Consolidated Balance Sheets: Condensed and adapted for educational use only In millions For Years Ended 1/30/2016 1/31/2015 ASSETS Current Assets: Cash and cash equivalents $ 1,976 $ 2,432 Short-term investments 1,305 1,456 Receivables, net 1,162 1,280 Merchandise inventories 5,051 5,174 Other current assets 392 1,130 Total current assets $ 9,886 $ 11,472 Property and Equipment, Net 2,346 2,295 Other Assets 1,287 1,478 Total Assets $ 13,519 $ 15,245 $ $ $ 4,450 409 2,066 6,925 2,216 9,141 LIABILITIES AND EQUITY Current Liabilities: Accounts payable Unredeemed gift cards Other current liabilities Total current liabilities Long-Term Liabilities Total Liabilities Equity: Paid-in capital and other Retained earnings Total equity Total Liabilities and Equity 5,030 411 2,336 7,777 2,468 10,245 $ $ $ $ $ $ 248 4,130 4,378 13,519 859 4,141 5,000 15,245 $ $ Best Buy Co., Inc. Consolidated Balance Sheets: Condensed and adapted for educational use only In millions For Years Ended 1/30/2016 1/31/2015 ASSETS Current Assets: Cash and cash equivalents $ 1,976 $ 2,432 Short-term investments 1,305 1,456 Receivables, net 1,162 1,280 Merchandise inventories 5,051 5,174 Other current assets 392 1,130 Total current assets $ 9,886 $ 11,472 Property and Equipment, Net 2,346 2,295 Other Assets 1,287 1,478 Total Assets $ 13,519 $ 15,245 $ $ $ 4,450 409 2,066 6,925 2,216 9,141 LIABILITIES AND EQUITY Current Liabilities: Accounts payable Unredeemed gift cards Other current liabilities Total current liabilities Long-Term Liabilities Total Liabilities Equity: Paid-in capital and other Retained earnings Total equity Total Liabilities and Equity 5,030 411 2,336 7,777 2,468 10,245 $ $ $ $ $ $ 248 4,130 4,378 13,519 859 4,141 5,000 15,245 $ $