According to the companys 2013 annual review, Finning International Inc. is the worlds largest Caterpillar equipment dealer.

According to the company€™s 2013 annual review, Finning International Inc. is €œthe world€™s largest Caterpillar equipment dealer.€ The company is headquartered in Vancouver, but has operations in Western Canada, South America, and the United Kingdom and Ireland. The following information is taken from Note 4 of the financial statements in Finning€™s 2013 financial report:

Required:
a. Based on the above information, what is the trend of the collectibility of the company€™s receivables? Did the amount of accounts being written off increase in 2013?
b. Calculate the percentage the allowance represents of each of the age groupings in 2013. Have these percentages changed from 2012? What do these percentages tell you about Finning€™s receivables after they are more than 120 days overdue?
c. Based on the above information, what was Finning€™s bad debts expense for 2013?

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December 31 $thousands) Not past due Past due 1-30 days Past due 31-90 days Past due 91-120 days Past due greater than 120 days Total 2013 2012 Allowance Allowance Gross 619,839 156,644 80,998 299 883 24,161 S25,346 Gross $548,989 160,844 73,470 15,264 50,464 $849,031 872 820 28,005 $29,697 8,956 55,822 $922,259 The movement in the allowance for doubtful accounts in respect of trade receivables during the period was as follows For years ended December 31 ($ thousands) Balance, beginning of year Additional allowance Receivables written off Foreign exchange translation adjustment Balance, end of year 2013 $29,697 5,849 (10,540) 340 $25,346 2012 $20,737 19,994 (11,134) 100 $29,697 The allowance amounts in respect of trade receivables are used to record possible impairment losses unless the Company is satisfied that no recovery of the amount owing is possible; at that point the amount is consid ered not recoverable and the financi asset is written off