If a company's bad debt as a percentage of its sales is increasing, it can be a sign of trouble. Therefore, it can be useful to calculate and monitor the percentage of bad debt over time.

On a calculator, for the fishing rod example, you’d put in 130, then the calculator’s multiplication sign (usually x or *), then a decimal point, then the percentage you have to pay.

We want to calculate the percentage of annual decline. First, we divide the most current revenue number by the beginning revenue number: $10 million divided by $15 million comes to 0.667.